West Bromwich Building Society slashes losses

The West Bromwich Building Society has slashed its losses by more than half over the past year, as it cut more than 200 jobs and launched a "back to basics" strategy after narrowly avoiding being broken up.

Major losses from commercial property and the credit crunch saw the society rack up a £48.8 million loss last year and it was only saved by a £182.5 million financial bail-out negotiated with the Financial Services Authority. But today the society revealed full-year pre-tax losses were down to £18.5 million.

As part of a major shake-up over the last 18 months it has also cut its workforce from more than 1,000 people to around 800 today.

Most recently the society announced in March that up to 80 jobs would be axed and 11 branches closed in sweeping cuts at the 160-year-old building society.

Chief executive Robert Sharpe, brought in to bail out the ailing society in October 2008, warned it was stlll suffering from the impact of the recession, low interest rates and fierce competition.

Today Mr Sharpe said: "The improvement on last year's results clearly indicates that we are starting to see the benefits of the West Brom's back to basics strategy, with its renewed focus upon our traditional strengths as a regionally-based building society and concentrating on our core activities of savings and residential mortgages."

The business had been split between its traditional work and the more risky operations including commercial lending that are being "run off" and wound down.

Over the year the West Brom pulled in more than 72,500 new customers and built up retail balances of £2.9 billion.

"The economic outlook is likely to stay unsettled for some time," said Mr Sharpe. But the society's new strategy "allows us to look forward with genuine confidence."