Jump to content
House Price Crash Forum
Sign in to follow this  
interestrateripoff

Nationwide Profits Soar Despite Bad Debts

Recommended Posts

http://www.independent.co.uk/news/business/news/nationwide-profits-soar-despite-bad-debts-8628340.html

Nationwide, Britain's biggest building society, grabbed its largest-ever share of the mortgage market last year and saw its profits jump as it continued to attract customers from discredited high street banks.

http://www.independent.co.uk/news/business/news/nationwide-mortgage-high-8627294.html

But at the same time the mutual was hit by a huge increase in bad debt provisions for its loans on commercial properties. These more than doubled from £247 million to £493 million — a level which represents just over a quarter of its commercial property loanbook.

Chief executive Graham Beale said: “Most of these loans relate to business done before the financial crisis. They are geographically diverse across the country and cover all sectors, including retail, warehouses, offices and leisure.

“There has been weak demand from tenants and falling property values, so we are helping our borrowers stay in business and also protecting our members’ interests.”

Profits up... That's good news.

Nationwide dangerously leveraging up? Or is it just taking the better quality borrowers from the banks?

Share this post


Link to post
Share on other sites

The commercial writedowns are of note-the problem has moved up the food chain from the landlords, who are often accused of not allowing rent reductions for fear of the subsequent asset reductions trashing the balance sheet. Seems the lenders are the ones allowing this to happen via forebearance. What happens when Nationwide's ability to make such provisions is exhausted?

Share this post


Link to post
Share on other sites

I would think that, due to forbearance, only a small fraction of the potential bad debt is on their balance sheet.

the more truth on the balance sheet, the more insolvent they will be.......on paper.

the balance sheet is a matter of opinion, the solvency is real.

Share this post


Link to post
Share on other sites

Why isn't this profit being passed onto the members in terms of savings rates.

I smell a rat.

its the low rates giving them the profit.

saying that, this bank has nothing to fear from a rates rise to normal....clearly, they only do sensible lending, taking into account that borrowers cold be faced with a 500% increase in BoE rates during the term.

Share this post


Link to post
Share on other sites

Join the conversation

You can post now and register later. If you have an account, sign in now to post with your account.

Guest
Reply to this topic...

×   Pasted as rich text.   Paste as plain text instead

  Only 75 emoji are allowed.

×   Your link has been automatically embedded.   Display as a link instead

×   Your previous content has been restored.   Clear editor

×   You cannot paste images directly. Upload or insert images from URL.

Loading...
Sign in to follow this  

  • Recently Browsing   0 members

    No registered users viewing this page.

  • 242 Brexit, House prices and Summer 2020

    1. 1. Including the effects Brexit, where do you think average UK house prices will be relative to now in June 2020?


      • down 5% +
      • down 2.5%
      • Even
      • up 2.5%
      • up 5%



×
×
  • Create New...

Important Information

We have placed cookies on your device to help make this website better. You can adjust your cookie settings, otherwise we'll assume you're okay to continue.