Coventry Building Society has reported that its mortgage balances grew by £1.1bn to £51.4bn in its half year results.

The 2.2% increase is due to a “robust mortgage pipeline, improved retention and has been supported by a conscious and disciplined approach to lending that reflects current market conditions and the needs of our members”, the society says.

It also reported continued low arrears with 0.31% of mortgages more than three months in arrears.

While arrears remained low, there was a slight increase from its full year results in 2023 where the figure stood at 0.26%.

Coventry’s half year profit before tax was £159m, down from £269m the year prior, which the society says is “in line with expectations following an exceptional operating environment in 2023”.

Net interest margin reduced to 1.05% from 1.34% as base rates stabilised, retail savings competition increased and mortgage customers repriced to lower margin products.

In May, Coventry signed a share purchase agreement for the acquisition of The Co-operative Bank which is expected to complete in the first quarter next year.

The acquisition will increase both the group’s mortgage and savings presence and extend the society’s propositions into the personal current account and business banking markets.

Coventry Building Society chief executive Steve Hughes says: “I am delighted to report that the Society has continued its sustained record of delivery in the first six months of the year.”

“We have grown mortgages and savings in a market where economic uncertainty persists and continue to offer great value products and exceptional service to our members. The Society has recorded a strong financial performance in the first half of 2024 and further enhanced our capital position.”

“We are making good progress to complete the acquisition of The Co-operative Bank in the first quarter of 2025.”

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