The Cumberland Building Society is embarking on major investment as it promises to offer banking services that are “kinder to people and planet”.
The pledge comes in the society’s annual report, published today, which underlines its position as the region’s leading mortgage and savings provider.
Savers’ deposits grew by £100m to £2.4bn in the year to March while mortgage lending hit a record £2.2bn as the Cumberland provided loans to over 500 first-time buyers.
Profits before tax fell from £10.5m to £8.6m, mainly because of increased investment in its Cumberland 2025 modernisation programme.
Writing in the annual report, chairman John Hooper said: “Our Cumberland 2025 plan will provide new digital channels, making it easier, quicker and more convenient to engage with us and manage accounts.
“Our branch customers will also benefit from a more streamlined, efficient way of working ‘behind the scenes’ too.”
The Cumberland is based in Carlisle and operates branches across Cumbria, southwest Scotland, Northumberland and Lancashire.
At a time when many banks and building and societies have carried out wholesale closures, the society remains committed to its branch network despite an increased uptake of online services.
As a mutual – owned by its savers and borrowers – it does not pay dividends to shareholders, enabling it to invest surpluses to improve services.
Chief executive Des Moore expects a “noticeable reduction in profits over the next few years” as the Cumberland steps up investment, cushions vulnerable customers from the rising cost of living and lives up to its new strapline: “Kinder banking. It’s in our nature.”
The society gives 1.5 per cent of profits to charitable causes, donating £188,000 in 2021-22. This year, it has pledged to donate £2 to Samaritans for every vote received at its annual general meeting.
During 2021-22, it retained its Platinum Trusted Service Award from Feefo, was ranked as one of the 100 best companies to work for in the North West and won ‘large business of the year’ at the in-Cumbria Business Awards.
It also collected two global operational excellence awards at the Business Transformation World Summit in Miami and won ‘financial services team of the year’ at the British HR Awards.
No Cumberland employee is paid less than the Real Living Wage. The year saw total employee numbers grow from 564 to 584 in part due to rising demand for telephone banking during Covid-19, which had a major impact on operations.
The head office in Carlisle reopened in February but many employees continue to work at home some of the time as the society embraces hybrid working as standard, which it says is popular with colleagues and will help it attract new talent.
The Cumberland is strongly committed to equality and diversity. It is working with Anti Racist Cumbria on staff training and hit a target of having women in a third of senior roles six months ahead of schedule. It aims to have 50 per cent of senior positions filled by women by April 2025.
It has also invested to better understand the impact of climate change on customers and the business.
Looking ahead, Mr Hooper said: “Financially, the Cumberland remains in a strong position. Despite the uncertainties of the pandemic, our arrears and bad debts remain remarkably low.
"The Cumberland is well placed to benefit in the medium term from the planned investment. This, coupled with the strong foundations provided by its distinctive business model, will allow the society to thrive into the future."
Michael Hulme, senior independent director, stood down from the board at the year-end. He is succeeded as senior independent director by Eric Gunn. The society expects to appoint a new non-executive director to replace Mr Hulme during 2022.