Coventry Building Society's Profits Decline Amid Acquisition Plans

Coventry Building Society has reported a significant drop in pre-tax profits, falling to £159 million in the first half of 2024 from £269 million a year earlier, attributed to an 'exceptional operating environment' in 2023. Despite this decline, the society saw its mortgage balances increase by 2.2% to £51.4 billion and savings balances rise by 2.6% to £48.8 billion. The society is in the process of acquiring The Co-operative Bank in a £780 million deal, which is expected to complete in early 2025 and will create a financial entity with around £89 billion in assets. The merger will revert Co-op Bank to a mutual structure, enhancing Coventry’s market position. Management expenses rose due to inflationary pressures and costs associated with the acquisition, while the society continues to invest in modernization efforts. Chief Executive Steve Hughes expressed optimism about the society's performance and ongoing growth despite the challenging economic landscape.