It has been reported that Nationwide will close its commercial property lending business as the UK’s biggest building society sees a fall in profit.
Compared to its profits of £802 million in the six-month period to the end of September last year, the same period this year saw a drop of 13 percent to £696 million.
The building society said the profit decline is due to record low interest rates, the commercial mortgage market’s high competition and an increase in bad debts. The closure of the business will impact fewer than 100 jobs.
Joe Garner, Nationwide Chief Executive, says:
“Our profit performance has reduced in line with our expectations and reflects continued margin pressure due to the prevailing low interest rate environment.”
Mr Garner further said, “Despite economic uncertainty following the UL’s Brexit vote, the society has continued to lend to help our members get on to and move up the housing ladder, with record net lending in the half year.”
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