Coventry reports marketshare rise

The UK's fourth-largest building society, Coventry, has reported mortgage lending at three times normal market share as borrowers opt to stay with the society rather than move to other lenders.

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It said the credit crunch has seen a "considerable reduction" in the number of people redeeming their mortgages during the first six months of the year.

As a result, despite the total value of mortgage advances rising by just 1% to £1.91 billion, net lending, which strips out redemptions and repayments, soared by 24% to £851m. It was three times the group's normal market share, at nearly 3% across all lenders and around 25% among building societies.

The Coventry also attracted high levels of savings, with money deposited into savings accounts by consumers rising by 9% during the period to reach £905 million at the end of June. It claimed the level, which was 32% higher than a year ago, was well above its natural market share.

The rise also provided further evidence of consumers' preference for mutuals after the collapse of Northern Rock last year.

Figures from the Building Societies Association show the sector enjoyed record savings inflows during the past year due to people's perception that mutuals provide a safer home for their money.

Copyright © PA Business 2008

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