Bradford & Bingley enjoys 5% profit rise

British mortgage specialist group Bradford & Bingley today said it was confident the UK housing market will survive the fifth interest rate rise in less than a year.

The group’s comments – following another hike in the Bank of England base rate to 4.75% yesterday – came as it posted a 5% rise in half-year profits to £140m (€210m) and said it had a business with “strong prospects”.

The buy-to-let specialist forecast that house prices would start to slow over the remainder of the year but added there was no cause to panic.

It told investors in today’s half-year results: “We continue to believe that the fundamentals necessary for a sudden correction are not evident and that a gradual slowdown is the most likely outcome.”

The former building society added it was on track to achieve the £40m (€60m) of savings it announced in June, including through the loss of 600 jobs.

It is also in the process of selling non-core businesses, which range from mortgage-broking arm Charcol to the company’s estate agency operation.

Chief executive Steven Crawshaw said: “The implementation of the strategic review is leading to a simplified, more focused business with strong prospects.”

The group said its lending book was now made up of 80% of residential mortgages and 20% commercial and housing association lending.