Nationwide will pay £340m directly into customer accounts for the first time, thanks to a rise in deposits and higher interest rates that pushed annual profits up 40% to record highs.
The payout, which amounts to about 15% of its annual profits, will benefit 3.4 million eligible customers, who will receive about £100 directly into their accounts in June.
The Nationwide chief executive, Debbie Crosbie, said plans for the payout were influenced by the recent rise in living costs: “We don’t see anyone else doing this, as such, and we think, in the cost of living crisis, it was really important to get people cash where we could, and we think it will have the most impact.”
The building society put aside £765m to cover a potential increase in defaults by struggling customers over the past year, up £19m compared with a year earlier.
“The transition to higher interest payments is a challenge for households as they adjust their expenditure priorities. We will continue to support those borrowers who face payment difficulties,” it added.
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