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Abbey, the Spanish-owned bank which swallowed up Alliance & Leicester and the good parts of Bradford & Bingley in the past year, saw its profits jump more than 30% in the first six months of the year.
The gain came as Abbey, which took no money from either the UK or Spanish governments during the banking bailouts, continued to increase mortgage and small business lending ahead of most of its rivals.
“We continue to support the UK economy with increased lending to homeowners and businesses, demonstrating our progress in becoming a full-service bank,” said chief executive Antonio Horta-Osorio.
“The first half of 2009 has been a very good one for the bank. We have delivered an excellent increase in revenue and profit despite tough market conditions, underpinned by market share gains and growth across all divisions.”
He said the bank, which will be fully rebranded under the Santander name by the end of 2010, was on target to attract one million new current accounts this year.
This business was not just being won from competitors but also reflects the fact that more and more customers want to keep their savings nest eggs in more than one basket after the collapse of several UK banks or bank subsidiaries last year.
Savings and business deposits rose by 15% to £4.7 billion.
Abbey has also taken a much larger share of the mortgage market in the first half as rival banks and building societies continue to refuse to lend.
It lent an extra £2 billion in mortgages. Bad debt provisions are up on last year but its willingness to help out over-borrowed homeowners when they fall into mortgage difficulties is shown in the six-month decline in the number of houses it holds after repossession, which fell from 1048 in December to 942 at the end of June.
Lending to small and medium-sized businesses rose 13% on a year earlier as more companies seek to have a relationship with more than just one bank in the current climate.
Abbey said it is roughly halfway through its planned 1900 job cuts this year which will take its staff numbers down to about 22,000. Almost all the cuts are coming in the head office and administration areas following the takeovers of A&L and B&B.
Parent Santander, the largest bank in the eurozone, saw its profits drop by 4.5% to €4.52 billion (£3.9 billion) as bad debt provisions jumped.
Reader views (1)
Hopefully their IT services will be upgraded as their systems are constantly crashing (like it did yesterday) - even the staff (the ones who are still left ) are frustrated with it!!
- Pearl, London, 29/07/2009 15:01
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