Nationwide Building Society has reported a fall in third quarter profits as it continues to count the cost of writedowns and investment in technology.
Statutory profit in the nine months to December 31 fell more than 20% to £703 million, which it put down to £167 million of “asset write-offs and additional technology spend”.
Underlying profits were down by 21% to £691 million.
Last year, Nationwide announced a £1.3 billion technology investment as it looks to take the challenge to digital rivals.
At the time, the building society said the cash injection would help “simplify its technology estate and build new technology platforms to enable growth and diversification, and drive forward digital, data and analytic strategies”.
Nationwide chief executive Joe Garner said on Friday: “In September we took the conscious decision to increase significantly our investment in the Society in the full knowledge that it would impact profitability in the short to medium-term but would be of long-term benefit to our members.
“This investment is to ensure we can continue to meet our members’ changing needs in an increasingly digital future.
“At the same time, consistent with member feedback, we remain committed to and are investing in our presence on the high street.”
Nationwide has been battling fierce competition in the mortgage market but said that net mortgage lending grew to £6.1 billion from £3.9 billion as the firm helped 59,400 first-time buyers on to the property ladder.
Gross mortgage lending stood at £26.8 billion versus £24.1 billion.
Deposit balances were up by £5.9 billion and the Common Equity Tier 1 (CET1) capital ratio, a key measure of a bank’s financial strength, grew from 30.5% to 31.7%.