Coventry Building Society's "traditional" business model has weathered the global financial storm to deliver record increases in lending and mortgage lending in 2007.
By funding the vast majority of its loans from its own resources, the society has not been affected by the global credit squeeze that has wreaked havoc with Northern Rock, which relied mainly on the wholesale markets to secure its funding.
The society, the biggest mutual in the West Midlands and the country's fourth biggest, said yesterday that its asset base rose by 21.4 per cent to £14.9 billion last year.
Retail savings balances grew by 25.3 per cent, or £2.1 billion, to £103 billion as the society won more than 100,000 new customers.
Gross lending rose by 44 per cent to £4.22 billion.
Profit before tax and other adjustments was up by 16.7 per cent at £69.1 million.
Chief executive David Stewart said the society, which was recently one of a number of lenders to pull their 100 per cent-plus mortgages from the market, said strong growth in savings, mortgages and underlying profits meant the Coventry had had a very successful year.
"There is no doubt that the environment was challenging, at times even hostile, for all mortgage lenders," he said.
"However, our ability to attract retail savings and our focus on low risk lending means we were well placed to meet these challenges.
"We've kept a traditional business model and still fund most of our lending with retail savings deposits."
At the year end, 95 per cent of loans were funded by savings, reserves and capital, Mr Stewart said.
The Coventry operates a prudent lending policy that means it mainly steers clear of trouble zones such as the controversial sub-prime sector, the meltdown of which has caused havoc in the US and across the globe.
What the society terms "credit impaired" lending - all of which was categorised as "near prime" or "light" - accounted for only one per cent of advances.
"The overwhelming majority of our mortgage lending continues to be in low risk sectors and we maintain strict limits to control the amount of potentially higher risk lending undertaking," Mr Stewart said.
In 2007 only 14.4 per cent of the Coventry's loans were for buy-to-let were six months or more in arrears on December 31, a figure that was less than one third of the Council of Mortgage Lenders' average of 0.48 per cent.
At 0.55 per cent of the book, the proportion of the Coventry's borrowers who ended the year three months in arrears was half the level seen for the industry as a whole.
"At the year end there were 33 properties twelve months or more in arrears out of a total of 124,000 accounts," said Mr Stewart.
"Prudence in mortgage lending is also reflected in our very cautious approach to treasury investments.
"We have not invested in structured investment vehicles, collaterised debt obligations or any of the other invest-ments that have given rise to substantial losses at other institutions.
"The society has no direct or indirect exposure to credit losses arising from the non-performing US mortgages."
The society ratcheted its key net interest margin - the difference between the interest it charges borrowers and what it pays savers - down to 0.82 per cent from 0.92 per cent in 2006 and reduced costs as a ratio of assets to 0.48 per cent from 0.53 per cent previously.
In contrast to the Coventry, the bigger Yorkshire Building Society said yesterday that its full-year pretax profits had fallen because of losses on some of its treasury-based investments.
Bottom line earnings slipped to £54.6 million from £77.9 million, although core building society operating profit was 19 per cent ahead at £9.1 million.
The result was a "reversal" of 2006's result, which the Yorkshire expects to recover in 2008, chief executive Iain Cornish said.