Total assets were £3.8 billion, down from £4 billion the year before and the group’s underlying pre-tax profit was £10 million.

Branch savings balances were up 2% to £2.4 billion and interest paid to savers up by12.8%.

To protect the average rate the society paid to savers in 2019, The Nottingham took a conscious decision to reduce new mortgage lending and focus on retaining existing borrowers. Gross mortgage lending exceeded £350 million.

David Marlow, chief executive officer at The Nottingham, explained: “Our planned reduction in new mortgage lending, in the face of falling market mortgage yields, was expertly managed to find what we felt was the right balance between the conflicting needs of our mortgage and savings members.

“We set ourselves a target to achieve 70% retention of existing borrowers choosing to stay with us when they get to the end of their promotional period, which was achieved.

“We also launched a number of exciting products, based on broker feedback including Retirement Interest Only and cashback mortgages, which paid out over £75k in cashback to homeowners last year alone.”

Arrears levels were low at 0.15% and remain below a quarter of the industry average of 0.72%.

The society recorded high levels of member satisfaction with a Net Promoter Score of 77%, which is well ahead of the financial services average of 49%.

The Nottingham’s whole-of-market mortgage advice arm, Nottingham Mortgage Services, saw a 15% increase in the number of members and customers using the service.

Last April the society launched its Lifetime ISA (LISA) online application, giving savers the ability to open the government-backed savings account in under four minutes, which thousands of savers have taken advantage of.

The society continued to invest in technology and last year completed the implementation of the Salesforce platform across all digital offerings including for online savers and mortgage brokers .

In November, its Mortgage Broker Portal went live, significantly improving its online mortgage decisioning and processing capability. The Nottingham reduced the time to get a decision in principle and apply for a mortgage from over two hours to just under 20 minutes.

Marlow said: “Whilst continuing to invest for the future, we have ensured that we take advantage of these new innovations and run the society in an efficient and well controlled manner; we were therefore pleased to reduce our underlying administration expenses by 10% over the year.”

Overall the society delivered an underlying profit before tax of £10 million. “Our conscious decision to reduce mortgage lending, whilst protecting savings rates and continuing to invest strongly in our digital future has inevitably led us to operate at a reduced level of profit in 2019,” explained Marlow.

“The board is very comfortable with this approach and we believe our performance reflects performances seen elsewhere in the current market climate.”

As it looks to the future, the society has reviewed two of its core markets, mortgages and estate agency, and as a result, has elected to re-evaluate some of the assets that it holds on its balance sheet.

Marlow was frank that these steps pave the way for more freedom and flexibility, particularly in how mortgages are priced in the future: “As the number of mortgage members retained at the end of their product term increases, our change in accounting estimate and resulting write down of the mortgage asset reflects our increasing conviction that no member should remain on our SVR for any meaningful period of time at the end of their product term.

“This step also reflects our intention to begin to refine the way we charge for mortgages over the next two years or so, as we carry out work to develop the capability to individually price each member’s mortgage, based on their own distinct characteristics.

“We have benefitted strongly overall as a society from the acquisition of estate agent Harrison Murray in 2013 not least in extending building society services to over 7,000 new members and attracting £150m+ of savings balances.

“But the estate agency market itself has undertaken structural changes over the past 2-3 years; in terms of annual transaction numbers, the level of fees achievable and in extra costs arising from regulatory requirements.

“We have therefore deemed it prudent to write off the goodwill that sits on our balance sheet in relation to the historic acquisition of the estate agency.”

Whilst both of these adjustments take the society to a technical accounting loss for the year of £7.2 million after tax, its core capital strength in the shape of the leverage ratio and CET1 ratio have both improved over the period.

In closing Marlow commented: “Our mutual status and ethos serve us well in times like these and we believe that through our hard work and the decisions we have taken during 2019, we are doing the right things to prepare the Society for a new era of financial services.

“The results we have seen in the first two months of 2020 are a strong endorsement of this as our membership continues to grow and we have seen a three-fold increase in the level of mortgage business received so far this year, compared to the same period in 2019.”

“In 2019 we have taken some big decisions to better support our members, whether that has been through significant investment in our digital future, which is beginning to deliver strong benefits or setting ourselves up to price mortgages more competitively for members.

“Add this to a range of new products and improvements we have planned for the next 12 months or so we are confident that we face into this new future for financial services well equipped to enable our great team to help more and more members save, plan for and protect their financial futures.”