Coventry Building Society enhanced its reputation as one of the most efficient in the sector by improving its cost ratio for the ninth year running in 2004.
Annual lending and savings figures released yesterday were short of the record highs of recent years, but the balance sheet was boosted again.
The company saw its total assets grow by six per cent to more than £9.4 billion last year while pretax profits jumped 7.2 per cent to a record £50.7 million.
The Coventry drove its administrative expenses down to 0.6 per cent of average assets, the lowest of any major building society.
At the same time the interest margin was squeezed down from 1.03 per cent of average assets in 2003 to 0.95 per cent this time.
Gross lending dipped marginally to £2.2 billion from almost £2.5 billion in 2003 and net savings balances increased by £101 million compared with the £204 million that flowed in the year before and the £1 billion-plus that the society attracted in 2002 thanks to a very competitive internet savings account.
This time round, a new family account aimed at giving a home to child benefit payments is attracting high levels of interest among savers.
Chief executive Martin Ritchley stressed that although assets grew last year by six per cent, costs rose by only two per cent despite the need to gear up for the new mortgage and insurance regulation regimes.
"In a highly competitive market we achieved gross mortgage lending of almost £2.2 billion, the second best in our history as well as net lending of £409 million," Mr Ritchley said.
The four percentage points difference between asset growth and cost growth meant the Coventry had had reduced its cost ratio for the ninth year running.
"This maintains our position as the most cost efficient major building society," Mr Ritchley added.
The society's prudent lending policy meant that just three homes out of some 150,000 in the society's portfolio were in repossession at the end of 2004. The number of loans 12 months or more in arrears fell from 39 to 28 during the 12 months.
Mr Ritchley went on to play down claims by some housing industry organisations that the market was moving back in favour of buyers and that gazundering was reappearing.
"We have not seen any evidence of that, we have seen evidence of parents having to help their children get on the housing ladder. First time buyers are disappearing."
