Skipton Building Society made nearly as much profit in the first half of this year as it did in the whole of 2012.

Pre-tax profits at the mutual financial group grew by nearly 60 per cent to £34.4 million against £21.7m at the halfway stage last year and just below the £35.4m for the whole of 2012.

The success came as the society attracted 11,000 more customers and increased gross lending by two-thirds to £1.09 billion. It also boosted net lending by £455m, or 4.4 per cent, at a time when overall UK residential mortgage lending was flat.

The Skipton drew down £410m under the Bank of England’s Funding for Lending Scheme which had increased its net UK mortgage lending since its launch by £656m.

Mortgage arrears (where the arrears balance was greater than 2.5 per cent of the total outstanding balance) fell to 1.16 per cent from 1.3 per cent, below the industry average of 1.42 per cent.

Skipton increased retail savings balances by £319m to £9.74bn, a growth of 3.4 per cent.

It saw continued improvement in the performance of its mortgages and savings division where profits increased by £12.5m to £16.2m, compared to £3.7m for the first half of 2012. The result was boosted by higher lending business and falling savings rates.

Chief executive David Cutter said the Skipton had continued to improve its key capital ratios and maintain prudent levels of high-quality liquidity, while meeting members’ needs through a personalised approach to service, further growth in lending and competitive savings products.

The group’s estate agency division, Connells, increased profits by a quarter to £23 million from £18.5 million in the first half of 2012 as a result of a 16.8 per cent increase in house sales.

Homeloan Management, the mortgage servicing business, traded profitably in a subdued outsourcing market, lifting pre-tax profits to £300,000 against £100,000 a year earlier.

Skipton’s three financial advice businesses overturned a £500,000 loss 12 months ago to post £500,000 profits as they benefited from a buoyant stock market for most of the period.

David Cutter said: “I am delighted to report a 59 per cent increase in profits at the same time as growth in mortgage and savings balances and capital ratios.”

“I am particularly pleased at the way in which we have achieved our results. We remain committed to being an organisation that cares about our customers, continually offering good value products to our members, backed up by outstanding personal service.”