Skipton Group Annual Report & Accounts 2025 2
We help people have a home
We help people finance homes
through the Society and Skipton
International Limited (SIL); and
support people in buying, selling, and
renting homes through our property
services group, Connells.
We make money work harder
We are here to make members’
money work harder, with a range of
savings products, Financial Advice
products, and services through the
Society and SIL.
We are built on two core
member needs – Homes
and Money
Together, we are diverse
and resilient
Leveraging the Group’s structure, unique mix of businesses, and our proud
mutual status, we can give more to our members, being there in the
moments that matter most to them.
It provides us with a diversified range of capabilities and enhanced
financial strength; with our strong performance showing just how valuable
our diverse Group is in meeting customers’ financial needs.
Skipton Building Society (the Society) has come a long way since it was
founded in 1853, supporting members with their financial wellbeing.
We are here to help people have a home, save for life ahead, and
support long-term financial wellbeing.
Our mutual foundation of looking after members, and our overarching
purpose, have remained the same since the Society was first founded.
We are driven by our
mutual heritage
The Skipton Group model was developed in the 1980s. The aim was to
build on the Society’s mutual roots, by developing a diverse range of
businesses that help people with a variety of financial needs.
Across our businesses we offer products and services that make a
difference to millions of lives. We innovate, campaign on issues that
matter, and strive to do things that benefit our communities and bring
value to society as a whole. Our mutual backdrop gives us the opportunity
to do that.
In addition to our core businesses (the Society, SIL and Connells group
(Connells)) our diverse Group also includes our invoice finance and asset-
based lending business, Skipton Business Finance (SBF) and our
innovative New Zealand-based AI-software company, Jade.
We are a financially strong
and diverse Group,
providing a range of skills
and knowledge to our
members
We are harnessing the collective power of the Group to offer products and
services to meet the needs of our members and customers, providing
innovative and unique solutions to real-life problems.
We are also using our Group platform to be an advocate for change - we
recognise the opportunity we have as Skipton Group to become a powerful
voice campaigning on societal issues.
Building a better Society
Skipton Group Annual Report & Accounts 2025 3
Performance & Strategy Governance
Financial Statements
Other Information
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Independent Auditor’s Report 119
Income Statements 132
Statements of Comprehensive Income 133
Statements of Financial Position 134
Statements of Changes in Members’ Interests 136
Statements of Cashflows 139
Notes to the Accounts 141
Chair’s Statement 5
Group Chief Executive’s Report 8
Strategic Report 12
Board of Directors 57
Directors’ Report 63
Corporate Governance Report 69
Board Audit Committee Report 83
Board Change Committee Report 91
Board Risk Committee Report 95
Directors’ Remuneration Report 99
Country by Country Reporting 288
Annual Business Statement 290
Glossary 293
Performance & Strategy
Governance
Financial Statements
Other Information
Skipton Group Annual Report & Accounts 2025 5
In the UK, inflation peaked at 3.8% before gradually
easing to 3.4% by the end of the year, offering some
respite for households after a prolonged period of
rising prices. Nevertheless, many families continue
to feel the effects of higher living costs, and our
commitment to supporting our members and
customers remains as strong as ever.
As we deliver the third year of our strategic plan, every
decision is guided by our mutual purpose and
anchored in our strategic priorities, enabling us to
support more first-time buyers, expand our advice
propositions, reward our members with competitive
products and maintain excellent service standards.
Our strategy is based on a solid framework that
allows us to continue to support our members in an
ever-changing world, despite the complexities of
market and geopolitical pressures that we more
regularly experience today, particularly across the
housing ecosystem.
We continue to invest in our Group businesses for the
future, ensuring that we remain well-positioned to
meet the evolving needs of our members and
communities. Our strategic priorities are detailed in
the Group Chief Executive’s Report.
Throughout 2025, we have continued to strengthen
our teams and enhance corporate governance across
the Skipton Group, and we remain well-placed to
continue to deliver on our strategy for the benefit of
our members.
Our Group is made up of diverse and resilient
businesses, each contributing to our purpose, and our
financial performance.
Skipton Building Society (the Society) holds
members at the heart of everything we do, supporting
them with their financial needs. Over the year, the
Society has remained resilient, delivering a profit
before tax (PBT) of £189.3m (2024: £209.9m), with
the reduction in profit compared to 2024 being
accountable in the main due to the strategic buy-back
of Permanent Interest-Bearing Shares (PIBS), costing
£28m (pre-tax) but leading to reduced future interest
payments, and increases in loan impairment amidst
an uncertain economic climate.
Connells group (Connells) our property services
group, continued to play a pivotal role within the
broader Skipton Group, having improved profitability
through the year, achieving a PBT of £73.1m (2024:
£61.3m). They have also continued to undertake
strategic acquisitions and investment in technology
to support colleagues and customers, and provide a
platform for further growth.
Skipton International (SIL) our Guernsey-based
savings and mortgage bank remained a valuable
contributor to its customers and to our Group. SIL has
delivered successive years of strong performance
and has since reached an inflection point, due in part
to an evolving regulatory environment in Guernsey
and the implications of that for the business. To
position the business for sustainable future success,
we took deliberate steps in 2025 to strengthen our
infrastructure – mainly in response to historic issues
with the book of business and of SIL's policies,
procedures and overall risk management
infrastructure – and enhance the management team
to set the business up for the next phase of its
journey. As a result, SIL PBT of £12.1m (2024:
£31.0m) reflects a reduction in new business
volumes.
“The past year has brought new
opportunities for the Skipton
Group in a challenging economic
environment.”
Gwyn Burr,
Chair, Skipton Group
Performance & Strategy Governance
Financial Statements
Other Information
Skipton Group Annual Report & Accounts 2025 6
Performance & Strategy Governance
Financial Statements
Other Information
Skipton Business Finance (SBF) our invoice
financing and asset-based lending business
delivered another year of growth and innovation in
2025, building their new Asset Based Lending
proposition to broaden their product offering and
increase their market reach. SBF will continue to
invest in technology, processes, and journey
improvements, positioning themselves for continued
sustainable growth.
Jade our AI and software business completed the
acquisition of Contec Group International in
November 2025, significantly expanding its footprint
in global dairy supply-chain technology and driving
new recurring global SaaS income streams that
strengthen our Group and enable us to reinvest more
value back into products and services for members.
Our colleagues
This has been another year where the dedication and
enthusiasm of our colleagues have been
fundamental to our success. Their unwavering
commitment to going the extra mile for our
members and customers plays out daily.
In 2025, the Society made real steps in building an
engaged and valued workforce. We doubled down on
our diversity and inclusion efforts by leveraging our
colleague diversity data to ensure that we are
building a welcome environment for all. We achieved
gender parity for the second year running in our
senior leadership population and exceeded our
targets for diversity and inclusion. I would once
again like to thank our Employee Resource Groups
(ERGs) for the voluntary effort and passion they put
into fostering an inclusive culture.
We took a significant step forward in 2025 in respect
of actively listening to our colleagues, by
implementing a pulse format of colleague surveys
and measuring colleague engagement through
employee Net Promoter Score (eNPS). I’m delighted
to report that our colleague eNPS achieved 42, which
supports our 5-year ambition of being in the top 25%
of financial services in the UK. We will use this as a
baseline for further improvement in 2026.
We are committed to supporting all colleagues
wanting to advance in their careers across the
Skipton Group, ensuring that we maintain and
enhance an environment where all colleagues can
thrive.
Sustainability
This year, we have made great progress in delivering
on our sustainability ambitions. We have now set a
Group-wide 2030 target, supported by a clear plan
for how we will achieve this; marking an important
step on our journey to net zero by 2050. Our efforts
remain focused on reducing emissions and
supporting the decarbonisation of the UK housing
stock, including sharing our learnings from the
retrofit of a house we own in Skipton, which we have
also used to inform and support policy
recommendations to the government on this
important topic.
We have continued to strengthen how we manage
and oversee sustainability across the Group. The
Group Sustainability Committee, established in 2024
to coordinate and drive progress on our
environmental and social priorities, is now fully
embedded. This year, we expanded its remit and
integrated our climate risk governance into our wider
sustainability framework, creating a more centralised
and holistic view of how sustainability and climate
risk initiatives connect and align with our strategic
opportunities.
We recognise that the sustainability landscape
continues to evolve, with new regulation, shifting
expectations and emerging best practice. We will
continue to evaluate the best course of action for the
Group as we manage our targets and plans. Further
details of our progress can be found in our 2025
Skipton Group Sustainability Report.
Giving back to our communities continues to be a
cornerstone of who we are. We remain committed to
pledging 1% of our annual Group PBT to charitable
causes that align with our purpose.
At our 2025 Annual General Meeting (AGM),
members voted to select Refuge as our next
strategic charity partner, and we look forward to
supporting their vital work over a three-year period.
Board changes and Governance
During 2025, several changes were made to the
composition of the Society’s Board of Directors.
Philip Moore and Mark Lund stepped down at the
AGM in April as Non-Executive Director and Senior
Independent Director respectively, after many years
of valuable service. Despite stepping down from the
Society board, we are pleased that Mark has
continued to serve as Chair of Connells’ board.
Andrew Bottomley also retired as Executive Director
and CEO of our Money business in April, after more
than nine years with the Society.
We thank each of them for their immense
contributions and commitments they have made.
(2024: N/A)
Society employee
Net Promoter
Score (eNPS)
Skipton Group Annual Report & Accounts 2025 7
Performance & Strategy Governance
Financial Statements
Other Information
Graham Lindsay joined the Board in May as Senior
Independent Director, bringing more than 45 years of
wide-ranging Executive-level experience in retail,
wealth and commercial banking. He is already
making a significant impact, and I look forward to
working closely with him over the years to come.
Changes across the Skipton Group
In September we welcomed Susan Fouquier as CEO
of SIL. Susan has over two decades of experience in
institutional and offshore banking and a passion for
colleague engagement, diversity and inclusion.
These skills will be invaluable as we continue to
grow this business for the future.
At the same time, we saw the retirement of Jim
Coupe after more than 15 years as SIL CEO. Jim was
a driving force behind the impressive growth of SIL
and we acknowledge his enormous contribution.
We also continued to enhance our corporate
governance arrangements throughout the Group,
appointing, Peter Griffith OBE as chair of Connells
with effect from February 2026. Peter has had a
distinguished career spanning over four decades. He
served as CEO of Sainsbury’s Bank (2012–2019) and
CEO of Principality Building Society (2002–2012).
Peter’s exceptional leadership experience and
extensive experience in corporate governance and
risk management will be invaluable as Connells
continues to strengthen its position as the UK’s
leading estate agency and property services
provider.
Both SIL and Connells also recruited new Non-
Executive Directors during 2025, while SBF appointed
Cathy Lewis as independent Non-Executive Chair
with effect from January 2026. These appointments
collectively strengthen those individual boards and
the oversight of each business as they pursue their
own strategic objectives within the Skipton Group.
Looking ahead
As we look to the future, I am filled with optimism
and confidence in the strength and potential of the
Skipton Group. Our mutual values, talented teams
and commitment to innovation will, I believe, ensure
that we are well placed to seize new opportunities.
Together, we will continue to deliver real value for
our members – through competitive rates and
innovative services that support our communities
and build a more sustainable future.
G Burr
Gwyn Burr
Chair, Skipton Group
17 February 2026
Skipton Group Annual Report & Accounts 2025 8
“2025 was another successful year
of growth and transformation in
pursuit of our purpose; helping
people have a home, saving for life
ahead, and supporting long-term
financial wellbeing.”
Stuart Haire,
Group Chief Executive
Skipton are here to help more people have a home,
save for life ahead and support long-term financial
wellbeing. Our purpose, dating back to 1853 when
the Society was first founded, remains as relevant
now as it was then.
Our diversified Group is built on a solid foundation of
mutual ownership, placing members and customers
at the heart of everything we do. This shapes how we
govern and operate and underpins our products and
services. Our core businesses are committed to
helping people finance their homes (Homes business
and SIL), buying and selling their homes (Connells),
and making their money work harder (Money
business and SIL).
Delivering our Purpose
2025 was a year of resilience and agility. Despite
housing market pressures and economic uncertainty,
we delivered the third year of our strategy in line with
our purpose.
Our Homes business supported 26,000 first-time
buyers, equating to 50% (2024: 44%) of our new
lending - a goal we originally set for the end of 2028.
Our commitment to first-time buyers has resulted in
our market share increasing to 4.0% (2024: 3.8%) of
this segment (Source: UK Finance – Regulated
Mortgage Survey; as at November 2025 being latest
available).
Connells, our property services group, continued to
support around one in ten home movers across the
UK. Connells helped more people have a home by
facilitating 85,982 exchanges on properties for sale
(2024: 78,995). Facing into a difficult market in the
second half of the year, they continued to grow
income to £1,177m (2024: £1,069m) and grow their
lettings business to 128,396 properties under
management (2024: 126,590).
Our Money business continued to deliver on our
ambition to provide free advice to our members, and
in 2025 we delivered over 64,000 free advice
conversations, representing a 63% increase on last
year.
Performance & Strategy Governance
Financial Statements
Other Information
(2024: 51,763)
Total regulated and
non-regulated
advice
conversations
(2024: 20,071)
Keys for first-
time buyers
(2024: 9.8%*)
Connells Estate
Agency market
share
*restated based on share of new listings
Skipton Group Annual Report & Accounts 2025 9
As we execute on our purpose, our Group mortgage
and savings book growth has outpaced the market
by 5.4% and 3.5% respectively, with our Group
mortgage book surpassing £33bn, and our Society
savings book surpassing a £30bn milestone for the
first time.
Throughout 2025, our other Group business, SBF
(invoice finance and asset-based lending), had a
successful year, with profits increasing by 8%. While
Jade (AI and software) completed the strategic
acquisition of Contec Group International Limited,
which is expected to boost Jade’s annual revenue by
up to 25%. In addition to Jade providing core Group
IT systems, they contribute alongside SBF to our
overall Group profits, which we use to reinvest back
into the Society to create a sustainable, resilient and
future-ready business for our members.
Collectively, our Group businesses delivered another
year of strong financial performance, despite
external headwinds and a ‘stop start’ UK housing
market.
Making membership matter more
We are focused on making sure more members are
choosing Skipton to support their long-term financial
needs. As we provide more value back to them
through above market average rates, we continue to
demonstrate our commitment to fairness and
making their money work even harder.
We have delivered 0.68% (2024: 0.74%) above
average market rate to our savers, providing
£195.7m more interest into our members’ pockets
(Source: CACI Current Account & Savings Database,
Stock, 12-months December 2024 - November 2025).
We have continued to support our members by
developing new propositions, such as our free advice
Stocks and Shares ISA. Our members have also
benefited from exclusive savings rates, enabling
them to grow their savings over the long-term.
Standing up for members and society
Across our Group, we continued to campaign for
meaningful change on behalf of our members,
communities and wider society. We published two
further editions of our Skipton Group Home
Affordability Index, which highlights the continuing
affordability crisis for first-time buyers, particularly
the five million adults living with parents in the UK.
These insights informed our engagement with
policymakers, including the Treasury Select
Committee, as we advocated for reforms to the
Loan-to-Income cap, reduced Stamp Duty and
improvements to the Lifetime ISA.
Standing with our Building Society peers, we have
been active in opposing the proposed cuts to the
Cash ISA allowance which could impact both our
savers and borrowers.
Enhancing member and broker satisfaction
Through our commitment to enabling member
participation and member and colleague listening,
we have continued to improve the service standards
we deliver. This is reflected in maintaining high
satisfaction scores across our businesses amidst
the backdrop of increasing expectations.
adults living with parents
cannot afford the average first-time
buyer home in their area
Performance & Strategy Governance
Financial Statements
Other Information
(2024: £302.3m)
Group
underlying PBT
(2024: £197.1m)
Value returned through
above market average
savings rate
Home affordability is at its lowest in
Even if deposit hurdles were
removed, would spend
of their income
on essential housing costs
Skipton Group Annual Report & Accounts 2025 10
Listening to members has guided our investments in
technology, systems and colleague development so
that members have the flexibility to interact with our
businesses seamlessly in the channel of their choice.
Combining our colleagues’ expertise with technology
allows us to deliver a human-touch experience in a
digital world.
Investing for the future
Through our transformation activity, we are enabling
better service for our members, utilising our new
Customer Engagement Platform to support over
24,800 advice conversations this year, combined
with upskilling more than 1,000 colleagues.
For members engaging digitally, our new app and
enhanced Portal will offer a simpler, more intuitive
experience. During the second half of the year, we
deployed our new app to all borrowers, with 57% of
those downloading the app being regular users. We
will see full deployment across our member base in
2026 and build more features into it, enhancing their
experience further.
We have also improved journeys for brokers and
borrowers, streamlining processes and leveraging
technology, making it faster for members to get
the support they need.
We are strengthening our agile practices of change
delivery to return value to members quicker,
collaborating across our businesses to embed these
practices and leverage our collective insights to
solve for more societal challenges.
We have adopted automation and AI tools including
Microsoft Copilot so that our colleagues have
access to the information they need, when they need
it. Since April, over 1,270 colleagues have used our
AI tool, signalling growing confidence, curiosity, and
capability when using AI. This has supported
colleagues to unlock new ideas and champion
efficiency for our members.
Jade, our AI and software business, developed and
deployed new automation and AI tools to their Jade
Platform clients in 2025, continuing to be a leading
provider of industry-specific Software as a Service
(SaaS).
This year, we have made deliberate, value-based
choices in the Society to prioritise long-term member
value over short-term business gains. We are
investing in technology, service and innovation that
strengthens our sustainability and sets us apart –
creating enduring benefits for members and the
communities we serve.
Through Connells (via Legal Marketing Services
(LMS)), we continue to support the industry ambition
of transforming the home buying and selling journey
for all parties through cross-sector collaboration,
streamlining and digitising the process. This year,
our National Property Transaction Network (NPTN)
pilot reduced the time between Sold Subject to
Contract (SSTC) to exchange by 35% and reduced
the cancellation rate by 43%. We have taken the first
steps to scaling this to a whole-of-market solution –
a move that could transform property transactions
across the UK.
We have made targeted acquisitions of
complementary businesses across the Group, to
further support our growth ambitions so that we can
deliver even greater value for our members. These
acquisitions include additions to Jade, our Lambert
Smith Hampton commercial real estate advisory
business and our London estate agency portfolio
within Connells.
Growing our colleagues and talent
We are continuing to strengthen and diversify our
Group leadership, welcoming new Executive and
senior talent including Jasvinder Gakhal as Chief
Executive Officer of our Money business and Susan
Fouquier as Chief Executive Officer of SIL.
The recruitment of such accomplished leaders
enhances our ability to deliver more innovative,
customer-focused services.
We remain committed to investing in colleague
development, fostering a culture of curiosity, growth
and empowerment. In 2025, we enriched our leader
training and deployed enhancements to our Workday
platform, enabling Society colleagues to access
insight more efficiently. We have also shared skills
and expertise across our Group to facilitate
colleague growth.
Our colleagues are vital to our success and through
embedding our new Society colleague listening
survey, we have introduced better feedback avenues
to connect and address this feedback promptly. As a
result, our engagement levels have increased by nine
points, with 89% of colleagues participating in the
survey.
As we grow, we will continue to invest in the
development of our ability to deliver innovative,
customer-focused and member centric services.
Performance & Strategy Governance
Financial Statements
Other Information
(2024: 90%)
Society net
customer
satisfaction
Skipton Group Annual Report & Accounts 2025 11
Continuing with purpose into 2026
I am proud of the progress that our Group has made
towards achieving its strategy and purpose, and I
would like to thank all Skipton Group colleagues for
their commitment to continuously delivering for our
members, customers, and wider society.
At a time when more people are facing financial
challenges, whether that’s buying a first home,
saving and investing, or looking for trusted advice,
Skipton Group has been there to help. We have
remained focused on addressing these challenges,
supporting members with our innovative products
and advice, and influencing policy to drive purposeful
change.
Despite facing into continued economic uncertainty
in 2026, our strength as a mutual and as a Group
means we can keep putting members first –
investing in better experiences and supporting
financial wellbeing for generations to come. I am
confident that the power of our Group will continue
to make a meaningful difference, playing our part in
building a more financially resilient society.
S Haire
Stuart Haire
Group Chief Executive
17 February 2026
Performance & Strategy Governance
Financial Statements
Other Information
Our commitment to members and customers
through 2025 has been recognised externally by
the achievement of the following awards:
• What Mortgage Awards: Best Intermediary
Lender – highly commended (Society) and Best
National Building Society - winner (Society)
• Moneyfacts Awards: Best Service from a
Mortgage Provider – winner (Society)
• British Mortgage Awards: Business Leader:
Intermediary Lender – Charlotte Harrison -
winner (Society)
• Chartered Institute of PR Awards: Business
Communications Campaign - Skipton Group
Home Affordability Index: Redefining housing
affordability - shortlisted (Group)
• Property Management Awards: Regional
Property Management Company of the Year -
finalist (LSH Residential, Connells)
• Moneynet.co.uk Awards: Best Building Society
Savings Provider - winner (Society)
• YourMoney.com Personal Finance Awards:
Best Junior ISA Provider – winner (Society)
• Money Comms Awards: Best Regular Savings
Provider - winner (Society) and Best Building
Society Savings Provider - winner (Society)
• Moneyfacts Consumer Awards 2025: Offshore
Account Provider of the Year - winner (SIL)
(2024: N/A)
Society Diversity
& Inclusion Net
Promoter Score
Performance & Strategy Governance
Financial Statements
Other Information
Our Group Business Model
13
Focusing on Ensuring Long
-term Success 15
Helping People Have a Home
16
Making Money Work Harder
20
Making Membership Matter
23
Colleagues Enable our Strategy
25
Building a Sustainable Society
27
Financial Review
35
Risk Review
47
Other Information
55
Skipton Group Annual Report & Accounts 2025 13
Connells is the UK’s largest high street estate agency and property services group with a c.10% market share in
its estate agency arm. Across its 80+ brands and over 1,200+ branches nationwide, Connells combines
residential sales and lettings with a range of consumer and corporate services including land and new homes,
mortgage services, conveyancing, auctions, surveying and valuations, commercial property services, Energy
Performance Certificate (EPC) provision and asset management. Connells is authorised and regulated by the
Financial Conduct Authority (FCA) for activities relating to regulated mortgages and non-investment insurance
contracts.
The Society is the UK’s fourth largest building society, offering mortgages through our Homes business, and
savings and financial advice through our Money business, with a national presence represented by a network
of 82 branches. The Society is authorised by the Prudential Regulation Authority (PRA) and regulated by the
FCA and the PRA.
SIL carries out mortgage lending in the Channel Islands and buy-to-let lending in the UK and accepts deposits
in Guernsey from an international customer base. SIL is licensed under the Banking Supervision (Bailiwick of
Guernsey) Law 2020, as amended and regulated by the Guernsey Financial Services Commission.
Other business lines
We have other smaller business interests that are not separately reportable, primarily concerned with income
generation and enabling capability to support delivery of our collective Group purpose. These smaller
businesses are combined within the ‘Other’ category in our financial reporting, together with the impact of
Group consolidation adjustments.
• SBF provides invoice financing and bad debt protection to small and medium-sized enterprises, based at
our Head Office in Skipton.
• Jade is based in New Zealand, specialising in digital and large IT enterprise solutions globally, and provides
the Society’s core database and software development language.
Together, we are stronger than the sum of our individual parts, and all our business lines play an integral part in
delivering our purpose and making membership matter.
You can read more about how we segment our Group in Note 47 to the Accounts.
Performance & Strategy Governance
Financial Statements
Help People Have
a Home
Make Money Work
Harder
Homes
Money
Other Information
Key business lines
Skipton Group Annual Report & Accounts 2025 14
Our Homes business within the Society provides
loans to borrowers to purchase and own their home,
whilst also supporting the private rental sector
through the provision of buy-to-let mortgages to
landlords. This is further strengthened through our
mortgage lending by SIL in the Channel Islands.
Our Money business within the Society brings
together a secure place for our members’ savings
with the provision of high-quality non-regulated free
education and advice to our customers to support
their long-term financial wellbeing. Combined with
the additional provision of Regulated Advice, our
offering sets us apart from our peers.
Connells, our property services group is focused on
delivering for customers and clients throughout the
process of buying, selling and renting homes.
Connells’ services include new homes, mortgage
services and conveyancing. Connells also supports
customers to have a home through its lettings
business and is one of the largest providers of
residential survey and valuation services in the UK.
To supplement our core activities, we also source
funding from the wholesale markets, which
diversifies our funding base and supports our long-
term financial stability.
Our mutual status means we don’t have
shareholders or dividends to pay out. We are
member-owned, and we have a responsibility to our
members to remain financially sustainable,
generating profit to invest back into our businesses
for the future benefit of members. This means we
reinvest our profits to support sustainable growth, to
modernise and remain relevant with new capabilities
and propositions, and to preserve a strong capital
position, supporting and protecting our members,
customers and creditors today and in the future.
Performance & Strategy Governance
Financial Statements
Other Information
The Skipton Group Business Model
• Savings deposits from members and customers
• Deposits from other banks, institutions and other financing e.g. covered bonds
• Retained earnings from previous profits and dividends from our Group
businesses
• Lend on mortgages to customers, through brokers and direct to customers
• Lend working capital to finance small and medium-sized businesses through
SBF
• Fees and commissions charged for regulated Financial Advice, mortgages,
buying, selling and renting homes and other financial products
• The difference between the interest we receive from mortgages and assets,
and the interest we pay on savings and deposits from other banks and
institutions
• Paying and developing our colleagues
• Distribution costs, e.g. our branches, offices and broker procuration fees
• Unpaid debts and other impairment losses
• Taxes
• Enhancing experiences and driving additional value for members and customers
• Providing multi-channel support to our members, customers and brokers
• Investing in the future of our Group, ensuring we maintain capital strength
• Committed to donating 1% of PBT to charity, to do good for society
Where the money
comes from
What we do with it
How we generate
income
Where we incur costs
What we use our
profits for
Skipton Group Annual Report & Accounts 2025 15
Economic and market background
2025 has continued to be shaped by global
complexity, with ongoing geopolitical tension and
climate-related challenges. In the UK, the new fiscal
policies announced by the Labour government
brought a period of adjustment as they begin to take
effect, creating both uncertainty and opportunity.
Economic performance has been mixed. After
modest recovery early in the year, growth slowed in
the latter half, reflecting cautious business
sentiment. Inflation peaked in September at 3.8% but
is now trending downwards, while the Bank of
England further reduced the base rate to 3.75%,
supporting affordability for borrowers.
Unemployment has begun to gradually increase and
there are signs the labour market is loosening.
As we enter 2026, we anticipate a continued period
of economic adjustment, with interest rates expected
to remain stable and inflation falling towards target
levels. While geopolitical and climate-related risks
persist, we see opportunities in digital innovation,
sustainable finance, and evolving customer needs.
The outlook for Skipton Group remains positive and
robust, with strong capital and liquidity ratios,
healthy and sustainable growth in both mortgage
and savings balances, good underlying profitability,
and a diversified business model.
Our focus will be on continuing our investment in
technology to enhance member experience and
supporting the UK housing market through
responsible lending. We remain committed to
delivering long-term value for our members and
communities, guided by our mutual principles and a
clear strategy for sustainable growth.
Decision-making
Achieving the right balance of risk and reward is
essential to ensuring the long-term sustainability of
the Group and enables us to deliver our strategy.
Through the Board Risk Committee approved Risk
Management Framework and governance structure,
the Group has a formal mechanism for identifying
and managing risks throughout the business, further
details of which can be found in the Board Risk
Committee Report.
The Group’s Corporate Plan, which is approved by
the Board, was developed in line with this framework.
The Board’s approach to Policies and Practices
The Board is responsible for approving the Group
strategy, managing risk, and overseeing its systems
of internal control. The ongoing effectiveness of
these controls is reviewed by the Board on a regular
basis (see below).
The Society maintains a high standard of corporate
governance for the benefit of its current and future
members, and to conduct its business in a prudent
and well organised manner. The Board’s terms of
reference clearly set out its responsibility for the
overall stewardship of the Group in line with the
Society’s ‘Principles of Governance’, as set out in the
Corporate Governance Report and available at
skipton.co.uk/about-us/our-people/our-board.
Our strategic priorities are monitored and reported to
the Board and senior management on an ongoing
basis. This enables the Board’s management of the
business and its decision-making processes.
Respect for our environment and the communities in
which we operate is also a key part (see Building a
Sustainable Society section).
Strategic priorities
Our three key strategic priorities keep us focused on
purposeful change:
• Helping People Have a Home - We will continue to
strive to make home-ownership a reality for more
people, with a keen focus on first-time buyers.
• Making Money Work Harder - We will invest more
to ensure our members receive above-market
average interest rates for their savings and have
access to free financial advice to help them plan
their financial futures.
• Making Membership Matter - Our members will
see and feel the value of Skipton membership,
being rewarded for their loyalty and tenure and
having more of a voice in the running of their
Society.
2026 is about building on our successes in 2025,
delivering core capabilities for our members and
customers and further enhancing our membership
proposition, giving back even more value when and
where it matters.
Performance & Strategy Governance
Financial Statements
Other Information
Skipton Group Annual Report & Accounts 2025 16
Our ambition is to champion first-time buyers and be
a leading contributor to the debate on affordable
housing in the UK. To guide our provision of
enhanced and innovative products and propositions,
our Homes business has three strategic priorities:
Helping people have a home
The UK affordability crisis has worsened, with only
10% of renters aged 20-44 able to buy, dropping to
3% for single occupants (Source: Home Builders
Federation report). This is supported by our Skipton
Group Home Affordability Index which shows 49 out
of 50 adults living with parents in the UK are unable
to afford a first-time buyer home in their local area.
Through continuing to innovate, we have helped over
26,000 first-time buyers out of this challenge. We
enhanced our Track Record Mortgage (first-time
buyer, no deposit required product) and more than
doubled Track Record lending year-on-year since it
launched in 2023. In addition, our Delayed Start
Mortgage (first-time buyer and no repayments due
for the first three months, to help with the costs of
moving into a new home), helped a further 670 first-
time buyers since it launched earlier this year.
Leaning into the affordability challenge further, we
enhanced our affordability policy including loan-to-
income limits. Through collaborating with Phil
Spencer in the “First Home Focus” series, we
provided clear, practical guidance to first-time
buyers, helping them take confident steps towards
home ownership.
Our commitment to championing first-time buyers
was further acknowledged by the Treasury Select
Committee in a hearing we attended in September.
We will continue to engage with policymakers,
providing evidence-based recommendations to help
shape solutions for aspiring homeowners.
The measures designed to improve market
accessibility in the governments Autumn Budget,
notably the permanent introduction of the 95%
mortgage guarantee, aligns with our commitment to
support aspiring homeowners as we continue to
address the affordability crisis in 2026. However, we
remain mindful of the ongoing challenges for first-
time buyers, including punitive stamp duty and the
frozen Lifetime ISA limits which may constrain
deposit-saving ability.
Performance & Strategy Governance
Financial Statements
Other Information
(2024: 44%)
New lending to
first-time buyers
• Helping people have a home
We will support more first-time buyers to
take their first steps onto the property
ladder
• Creating outstanding experiences
We will empower our customers and
brokers to engage in their channel of
choice
• Championing the intermediary market
We will advocate for brokers and maintain
mutually beneficial relationships
Skipton Group Annual Report & Accounts 2025 17
In 2026, we will further seek to address the
affordability challenge by evolving our first-time
buyer products and propositions, partnering with
industry experts and pioneering new solutions.
Beyond first-time buyers, we continue to support
home-movers and re-mortgagers with affordable
solutions across our portfolio.
We will give them confidence in taking the next step
when their current deal comes to an end, equipping
them with the knowledge and information they need
to navigate the process seamlessly.
Creating outstanding experiences
Through 2025, we have focused on truly
understanding our members needs, improving their
experience by reviewing our processes, upskilling our
colleagues and streamlining our journeys so we
deliver what matters most to them. This includes
piloting a new process, unlocking the ability to
perform desktop valuations on new build properties -
reducing the time to offer to just 4 days on almost
one quarter of cases since launching in August.
In 2026, we will continue to empower colleagues to
deliver even greater value through tailored learning
and development and broadening roles, providing
colleagues with greater accountability so they can
own the full member journey.
As a modern mutual, we have also continued our
work migrating data to the Cloud Microsoft Azure
Platform. This year, our decisioning system was
migrated to the Cloud, enhancing the speed and
accuracy of our mortgage decision making.
Our Affordability Calculator, Online Decision in
Principle, and Webchat were also migrated, creating
the ability to enhance these tools further.
In the first three months of the year, we worked to
ensure every customer could complete their home
purchase ahead of the stamp duty deadline. By
prioritising speed and care, we made sure no one
was left behind, supporting almost £1.0bn of
completions in March.
Championing the intermediary market
Through our commitment to the intermediary
market, we are proud to consistently maintain
excellent broker feedback and satisfaction scores,
reinforcing our position as an intermediary-led
lender.
In 2025, we continued to invest in technology to
optimise broker journeys, making it easier for
brokers to interact with us. Brokers can now sign on
behalf of their customers when switching products,
speeding up application times. We also strengthened
relationships with distributors and firms and
collaborated with brokers to improve our offering.
Our ambition is to be the go-to lender for first-time
buyer insight. Our “Skip-to” marketing campaign
Performance & Strategy Governance
Financial Statements
Other Information
(2024: 91%)
Net Homes
customer
satisfaction
“Skipton are helping the
next generation to become
homeowners”
(2024: 89%)
Net broker
satisfaction
Skipton Group Annual Report & Accounts 2025 18
increased broker awareness of Skipton’s first-time
buyer offerings, ranking Skipton sixth in broker
awareness. Our innovation continued to challenge
the status quo, growing broker advocacy and earning
recognition by winning Best Intermediary Lender at
the What Mortgage Awards for the fifth consecutive
year.
In 2026 we will build on this momentum, reducing
the time to offer on applications, making it easier to
do business with us.
SIL
Our lending spans into the Channel Islands, with SIL
(our Channel Islands bank) offering a UK mortgage
proposition specifically for buy-to-let investors
residing overseas.
Throughout 2025, SIL has focused on delivering
improved customer journeys, providing simplicity
and speed that result in a better experience for
customers and colleagues alike.
Mortgage lending performance
Our unwavering focus on first-time buyers, borrowers
and brokers within the Homes business has led to
another successful year of performance. In addition
to the Society achieving a £30bn mortgage balance
milestone, the Homes business has been recognised
as the sixth largest lender for first-time buyers by
eBenchmarkers.
Our Group mortgage portfolio grew by 7.9% (2024:
8.2%) whilst maintaining our prudent credit risk
appetite. The Group has increased its market share
of balances to 1.91% (2024: 1.81%) (Source: Bank of
England Statistics).
The Group’s UK residential mortgages in arrears by
three months or more remained low, representing
only 0.30% of mortgage accounts (2024: 0.29%)
which compares to the industry average of 0.78%
(Source: UK Finance - residential mortgages in
arrears by more than three months).
Skipton Group will continue to innovate, facing into
market challenges and delivering more value back to
our members, customers and brokers. We remain
dedicated to leading the way on driving purposeful
change, leveraging our collective Group voice and
unique insights to stand up for members and wider
society.
Home buying and selling performance
The UK housing market started strongly in the first
half of 2025, with exchanges up 19% on the same
period in 2024 ahead of the Stamp Duty changes in
March and the easing of base rate pressures on
affordability.
In the second half of the year, activity was subdued
by comparison, with the Autumn Budget uncertainty
surrounding property reform impacting supply and
demand. Despite market volatility throughout the
year, Connells delivered good performance and
reinforced its leadership position through strategic
growth and innovation.
Our mortgage services proposition continued to
provide whole-of-market advice and mortgage
lending, generating £33.3bn of lending (2024:
£31.7bn) across UK providers. Our lettings business
that manages properties on behalf of landlords also
grew, with properties under management increasing
Performance & Strategy Governance
Financial Statements
Other Information
(2024: 8.2%)
Group mortgage
portfolio growth
“It’s always simple with
Skipton. Quick and easy”
Skipton Group Annual Report & Accounts 2025 19
by over 1,800 to 128,396 (2024: 126,590), driving
additional income for the group. Our average
tenancy length increased to 36 months with 73% of
properties re-let by Connells at the end of their
tenancy (December 2024: 79%). Rental properties in
arrears increased slightly in 2025, to 6.1% (December
2024: 5.0%).
With the Renter’s Rights Bill becoming law, we are
well placed to support landlords and tenants with the
changes coming into effect in 2026 which will
fundamentally reshape the private rental market
towards a more tenant favourable environment.
Through our Connells estate agency network, we
continue to support around one in ten home movers
across the UK. We have strengthened our position
through targeted acquisitions in the first six months
of the year, creating network expansion, and now
reaching 88% of UK postcodes.
This includes the addition of Aspire Estate Agents
Ltd, bringing six new branches to our 1,200+ strong
network and 745 managed properties into Connells,
supplying more customers with our property services
propositions.
This year, we built and launched Karri, our new
mortgage services brand, that provides a user
interface designed to help more customers secure
the right lending solutions and the right advice for
their homes. In early 2026, we will roll out our brand
to connect online property to customers, with our
service being available in over 1,000 UK locations.
This forms part of our ongoing commitment to
digitising the home buying and selling journey.
Our commitment to service excellence was
recognised with the Platinum Fee Service Award
from Feefo, building on our Gold status in 2024 and
maintaining a market-leading score of 4.8/5.0 (2024:
4.8/5.0). Connells was also named among the
Sunday Times Top 26 ‘Best Very Big Places to Work’.
Innovating home buying and selling
The breadth of Connells’ businesses provides us with
unique insights into some of the challenges that
have hindered the UK home buying and selling
process in recent years.
Our collaboration with Legal Marketing Services
(LMS) (the UK’s leading provider of conveyancing
platform services, of which Connells is a 50%
shareholder), has provided an opportunity to rapidly
test and evaluate new solutions that can overcome
challenges to deliver a faster, more seamless and
less stressful experience for all parties involved.
Following the success of our proof of funds pilot in
2024, and the roll out of National Property
Transaction Network (NPTN), we are further trialling
solutions that bring property information to the start
of the process, before the property is listed for sale.
This leverages trusted data that removes duplication
and speeds up overall process time.
In November, we also launched a new pilot with the
Society, to send valuation queries directly to the
valuer, aiming to reduce the response times for
valuation-related enquiries. By collaborating across
the Skipton Group, we can rapidly test specific
solutions that solve the pain points for our
customers within the end-to-end journey.
As we move into 2026, the clarity in the Autumn
Budget provides a stable environment for continued
demand across the housing eco-system and further
innovation as we leverage the strength of our group
to serve even more customers.
Performance & Strategy Governance
Financial Statements
Other Information
(2024: 54)
Average number of
properties for sale
per branch
(2024: 4.8/5)
Feefo review
score (out of 5.0)
(2024: 126,590)
Properties under
management
Skipton Group Annual Report & Accounts 2025 20
We remain committed to supporting financial
wellbeing, providing guidance and advice to more
members with propositions that make our members
money work harder. We recognise that we need to
continue to evolve member experiences, delivering
meaningful value to help them meet a broader range
of lifetime financial goals.
Our three strategic priorities within our Money
business will help us achieve this:
Providing advice for everyone
Many people in the UK are not getting the help they
need to make their money work harder and support
them across key life events. This is contributing to
an Advice Gap and a Transfer of Wealth challenge.
The UK is entering a new period of wealth transfers,
with an estimated £5-7trn expected to transfer from
older to younger generations over the next 20-30
years (source: Heligan Wealth Management Report).
In 2024 we took a deliberate step towards bridging
the Advice Gap by introducing free advice to
members, regardless of the amount they had
available to invest, through our ‘My Money Review’
and ‘My Money Enquiry’ services. Available through
branch and telephony channels, the uptake of this
free member benefit in 2025 has exceeded our
expectations, demonstrating a clear member need to
talk about financial wellbeing.
Having anticipated the need for advice, we will scale
our propositions to support even more members and
their families with the help that they need, regardless
of background, income or circumstance, supporting
the FCA’s Targeted Support and Financial Inclusion
policies further.
For those with more advanced or complex needs,
Skipton are proud to be the only Building Society to
offer a direct Regulated Advice proposition. In
October, we continued to refine the Regulated Advice
experience, launching our ‘Advisor First Appointment’
tool, which has already created smoother, more
intuitive first interactions for 775 customers.
Throughout 2025, we have supported 5,836
customers with our Regulated Advice (2024: 5,385).
Offering high quality products and services
With the base rate reducing during 2025, we remain
committed to paying competitive savings rates and
enhancing our offering with member exclusive
products.
Performance & Strategy Governance
Financial Statements
Other Information
(2024 £4.7bn)
Funds under
management
• Providing advice for everyone
We will offer more accessible advice to our
members to make more from their money
• Offering high quality products and
services
We will grow our members and customers,
helping more people with their money
• Making every interaction count
We will increase our digital journey options
to give members and customers more
choice
Skipton Group Annual Report & Accounts 2025 21
By December, our minimum variable savings rate
was 2.05% AER (2024: 2.80% AER).
Members benefitted from a choice of two
exclusive products (ISA and non-ISA easy access
products) alongside our fixed range. As a thank
you to members for continuing to trust us with
their savings, we also provided a £50 retail
voucher to reward their loyalty during ISA season.
Our proposition was further strengthened with the
launch of our ‘Save More’ member bond, and new
member regular saver accounts. In 2025, over
90,000 members took out an exclusive rate
savings account.
To complement our savings offering and the UK
Government’s desire to support more consumers
with investments, we introduced a free advice
Stocks & Shares ISA - exclusive to our members
and designed to help savers make informed
decisions between cash savings and investments.
Following the Governments Autumn Budget which
announced changes to the Cash ISA limit for
under 65’s, we are ready to support members with
our advice propositions to help more people
navigate the investment landscape.
Amongst the advice we provide, we are here to
help people save for their pension and help them
understand when the right time to retire is.
In 2025, our Money business delivered 7.8%
growth in our savings book and maintained our
high net customer satisfaction of 90% from 2024,
reinforcing the quality of service we strive to
provide.
Making every interaction count
We are innovating our technology, making
improvements across all channels (digital,
telephony and in-branch), to continue to deliver
against our ambition of enabling ‘any channel’
experiences so that members can interact with us
however they prefer. This year, we unlocked ‘any
channel’ service for 47% of savings journeys
(December 2024: 24%).
We have deployed an upgraded member portal,
and a Customer Engagement Platform which are
designed to make it easier for members and
colleagues to manage accounts and connect with
each other whenever required.
Following the transfer of borrowers to our new app
this year, we will scale this to our Money members
and customers in 2026. By listening to member
feedback, we will continue to build increased
functionality to allow our members to interact
digitally, whilst protecting them in an ever-
changing digital world.
Performance & Strategy Governance
Financial Statements
Other Information
(2024: 90%)
Net Money
customer
satisfaction
“Skipton give excellent service, their
colleagues are knowledgeable and
honest ensuring you get the right
product suited to your personal
needs”
(2024: 1,004k)
Number of savers
and investors
Skipton Group Annual Report & Accounts 2025 22
“We are members of
Skipton because our money
is safe, and we’re treated as
humans. Not a commodity.”
This year, we tested a new telephony analytics tool
which enabled our colleagues to better understand
what matters most to members. Having seen the
positive impact it can make, we will introduce this
across all telephony services in 2026.
We continue to hold the Consumer Duty principles at
the heart of our business practice, ensuring good
outcomes for all customers. Supporting vulnerable
members remains a priority, tailoring our services to
ensure that they remain accessible to meet individual
needs.
SIL
SIL provides offshore savings solutions, offering
Sterling and US Dollar accounts, fixed rate bonds and
easy access products. Savings balances remained
resilient at £2.4bn (2024: £2.4bn) despite not actively
pursuing growth during this period.
Our commitment to customers in the Channel
Islands is consistently recognised through award-
winning service and ‘excellent’ Feefo rating. Feefo,
the gold standard in customer reviews, requires a
minimum score of 4.5/5.0.
SIL are proud to be a five-time Feefo Platinum
Trusted Service Provider, following eight consecutive
years of Gold accreditation. In 2026 we will refocus
on growth and explore opportunities to broaden our
reach to more customers.
Savings performance
Our savings propositions delivered another year of
growth, driven by excellent retention and balance
increases.
For the Society, the Money business’ competitive
savings rates and excellent service increased total
balances by 7.8% (2024: 8.9%) to £30.5bn (2024:
£28.3bn), doubling our savings book since 2017 and
outperforming the UK savings market where net
savings grew by only 4.4% (2024: 5.1%) (Source:
Bank of England Statistics).
The Money business also achieved record ISA
transfer activity, contributing to 19.8% ISA growth
throughout the year. Our Regulated Advice balances
also grew, surpassing £5bn Funds Under
Management, reflecting the accessibility of our
propositions and the strong consumer desire for the
provision of savings and advice.
As the UK’s first provider of the cash Lifetime ISA
(LISA), we hold balances of £1.1bn (2024: £1.2bn)
for customers who are saving for their first home or
planning for retirement. These customers benefited
from government bonuses of £45.1m (2024:
£56.2m).
We will continue to test new propositions with our
members in 2026, acting on their feedback to ensure
the products, propositions and services we design
address their needs. Skipton will continue to support
members and customers, as together we face into
the Advice Gap and Wealth Transfer challenge.
Performance & Strategy Governance
Financial Statements
Other Information
(2024: 4.7/5.0)
Feefo review score
(out of 5.0)
Skipton Group Annual Report & Accounts 2025 23
Membership sits at the heart of our Group and
underpins everything we do. We remain committed
to Making Membership Matter.
Skipton will Make Membership Matter more through
three membership strategic priorities:
We will measure the success of these priorities
through our “Member Sentiment Score”, which gives
us direct member insight on how we are delivering
value, supporting communities and giving members
a say in how our Society operates.
We have brought the Society brand to life for our
current and future members, reflecting our mutual
roots as being Founded on Fairness. Communicating
fairness across a multi-channel campaign increased
our brand consideration to 26.5% (against a target of
20%).
Society membership continued to grow through the
year, increasing by 4% and taking our total
membership base to 1,317,047 (2024: 1,266,608).
Creating value exchange
We have continued to provide exclusive member
products and services, including 'always on' savings
products. We also reserved our best rates for our
members, recognising and rewarding their loyalty.
On average, we paid 0.68% higher interest (2024:
0.74%) than the market average for banks and
building societies (Source: CACI Current Account &
Savings Database, Stock, 12-month December 2024 -
November 2025).
Our colleagues are empowered to recognise
moments that matter to members, offering gestures
of goodwill and acts of kindness to surprise and
delight members. Over 2,000 of our members
received gifts from our colleagues to mark special
occasions or times of need, reinforcing our
commitment to making membership matter.
For first-time buyer members, we recognised them
getting the keys to their home by gifting over 20,377
Home Mover Boxes, containing essential household
items.
For borrowers, we also launched a member
mortgage range, recognising their loyalty through
providing £250 cashback on their new member
mortgage product. Our Home Insurance proposition
in partnership with Uinsure, delivered cheaper
premiums to c.95% of existing home insurance
customers, to ensure their homes are protected.
In partnership with Vibrant Energy (a Group
company) we continued to offer a free EPC Plus
report to 1,577 members (December 2024: 1,591),
providing recommendations for energy efficient
improvements to their homes.
Performance & Strategy Governance
Financial Statements
Other Information
(2024: 46.6%)
Society member
sentiment score
(2024: 0.74%)
Above market
average savings
rate
(2024: +10k)
Gestures of
goodwill
• Creating value exchange
We will give members exclusive benefits,
encouraging deeper engagement and
loyalty
• Encouraging meaningful participation
We will give members opportunities to
participate, listen and collaborate
• Supporting communities
We will support our wider society, making
a real difference in our local communities
Skipton Group Annual Report & Accounts 2025 24
Encouraging meaningful participation
In 2025, we are proud that 60,647 members
exercised their voting rights in the AGM, shaping the
way our Society is run and governed. This also gave
members the opportunity to select our charity
partner. Our members voted to partner with Refuge,
helping the organisation continue its vital work of
empowering survivors to regain control of their
finances and build confidence in managing their
money after abuse.
We recognise the importance of our members’
voices and continue to encourage participation
through a range of forums, including our member
panel and digital collaboration platform. This has
helped us better understand topics such as longer-
term mortgage products, life insurance, online
security and the ‘Great Wealth Transfer’.
Throughout the year, we have recruited new
members to our panel, continuing to expand
representation to include first-time buyers, to ensure
a diverse range of perspectives inform our decisions,
products, services and communications.
Supporting communities
Supporting wider society and making a real
difference in local communities remains a core
priority. Colleague volunteering continues to play a
vital role, with every Society colleague able to
dedicate up to three days annually to the causes that
matter most to them.
Skipton Group remains committed to donating 1% of
its PBT to charity each year. As part of this, in 2025
we allocated £164,000 across 82 branches to
support 246 local charities, empowering branches to
choose the causes most important to their local
members and communities.
We remain committed to our branch network,
investing in their refurbishment for our members and
broader society to utilise the space. Each branch has
been issued with toolkits to support the events they
hold and their broader community outreach.
Our branches have facilitated help and support to
their communities alongside our 2024 charity
partners Age UK and National Energy Action, most
recently rolling out a Winter Warmer campaign.
Looking ahead, our focus remains on raising
awareness of the value of membership, ensuring
more members enjoy its benefits. We will continue to
deliver more value through exclusive rates and
products, as well as create bespoke member
offerings for both new and existing members.
Performance & Strategy Governance
Financial Statements
Other Information
(2024: 23.5k)
Members on our
Customer Panel
(2024: £3.3m)
Donated to good
causes
“We received a hamper on
our first wedding
anniversary, a lovely
personalised touch from
Skipton”.
Skipton Group Annual Report & Accounts 2025 25
We remain committed to fostering a culture across
our Group that enables colleagues to realise their
potential, deliver meaningful impact for our
members and customers, and feel a genuine sense
of belonging.
Our approach is underpinned by Society colleague
behaviours that define how we work:
Investing in our Group colleagues
We have continued to invest in our Group colleagues,
developing their knowledge, skills and capability so
they can continually grow at work.
This year, the Society, SBF and SIL provided new
learning tools designed to strengthen development
and unlock growth. 77% of SIL colleagues have
become active users of their ‘Thrive’ learning tools,
while 285 Society colleagues utilised ‘Cognassist’, a
digital platform designed to help colleagues identify
learning needs and gain access to personalised
insights.
Across Connells, we delivered over 2,100 training
and development classes, while the Society held
upskilling events on key topics throughout the year.
Our AI event, co-facilitated by Microsoft and industry
experts, demystified the use of AI and empowered
485 colleagues to utilise our AI tool in a safe and
sustainable way.
Contributing to our Group culture of enabling
colleagues to realise potential and feel like they
belong, the Society piloted ‘Stepping Up’, a
development programme to build confidence,
visibility and career progression. This delivered
significant improvements, increasing colleague self-
advocacy and career progression.
Our investment in learning and growth extends to the
development of the next generation of colleagues,
welcoming local students on six-month supported
work placements, collaborating with Right2Work to
increase confidence, independence, and practical
experience for young people in our community.
Rewarding our colleagues fairly for their great work
is central to our Group ethos, so SIL launched a new
internal recognition programme to celebrate
colleagues that went the extra mile, while the Society
made our approach to pay more visible and
accessible for colleagues.
To support our digital transformation activity, we
have strengthened our Group Technology,
Transformation and Resilience teams, including the
creation of a new Enterprise Architecture function
who specialise in aligning technology, processes,
and strategy to make our operations more efficient.
Further, recruitment of senior Technology and AI
roles is underway at Jade to strengthen our
engineering capability.
We will continue to develop Group-wide colleague
initiatives, leveraging collaboration to unlock further
growth opportunities so our people can continue to
thrive at Skipton.
Championing Diversity, Equity and Inclusion (DEI)
Our Group’s purpose is built on fairness, belonging
and opportunity for all. At Skipton, we know that
diverse perspectives and inclusive practices
strengthen our ability to serve members and
communities. We are committed to creating an
environment where every colleague feels valued,
respected and empowered to contribute their best.
Across the Society we have 43 accredited Diversity
Allies – with even more across the Group -
championing inclusivity and fostering a culture of
respect and understanding.
Through dedicated events, we brought our
colleagues together to spotlight inclusion, with a
dedicated month in June, and a fortnight in October.
This year we have delivered over 20 sessions to
colleagues on all areas of inclusion and wellbeing.
The sessions upskilled colleagues on a range of
diverse perspectives and provided them with
practical tools to support wellbeing.
Our Employee Resource Groups (ERG’s) remain a
cornerstone to our Group, providing colleagues with
a platform to connect, share experiences and
influence positive change.
Each of our Society ERGs donated £5,000 to a
charity of their choice, with the Gender Equity ERG
donating to PANDAS Foundation (Pre and Postnatal
Depression Advice and Support) and the Pride
Alliance ERG donating to Switchboard LGBT+.
Performance & Strategy Governance
Financial Statements
Other Information
We actively own our roles, commitments,
decisions and work
We draw on our courage to do the right thing
when it feels uncomfortable
We use our unique talents and diverse
backgrounds to reach the best outcome
We bring questions, critical thinking and
understanding to make things better
Skipton Group Annual Report & Accounts 2025 26
Performance & Strategy Governance
Financial Statements
Other Information
^ Gender voluntarily declared by colleagues
1. Society Board Directors only
2. Comprises the Society’s senior leaders (other than Executive
Directors) and Executive Directors of other Group businesses
Executive Directors
1
(2 colleagues)
Non-Executive Directors
(7 colleagues)
Senior Leaders
2
(83 colleagues)
Other Employees
(18,756 colleagues)
Executive Directors
1
(2 colleagues)
Non-Executive Directors
(7 colleagues)
Senior Leaders
2
(75 colleagues)
Other Employees
(2,539 colleagues)
Male^
Female
100%
100%
57%
57%
43%
43%
49%
51%
52%
48%
47%
53%
56%
44%
Co-ordinated by the Armed Forces
Employee Resource Group, we marked
Armistice Day with a special service at our
Society Head Office, honouring the courage,
sacrifice, and service of the Armed Forces.
Through their donations, our ERGs have helped
make a meaningful impact beyond our
organisation.
In addition to charitable giving, our ERG’s have
been pivotal to progressing our Group DEI
ambitions with the Society’s Armed Forces ERG
leading the way in securing Skipton’s first Gold
Accreditation under the Armed Forces Covenant,
(elevating from our Silver status achieved last
year), while Connells elevated from Bronze to
Silver status. This highlights our Group
commitment to supporting those who serve(d)
and their families.
The Group has maintained a range of partnerships
to help inform our inclusive practices. Support
gained from Business Disability Forum
contributed to the Society maintaining our
‘Disability Confident’ status and our partners at
Inclusive Employers collaborated to upskill 204
colleagues on the importance of becoming Active
Bystanders. Connells partnered with AccessAble
to enhance physical accessibility practices and
broaden colleague understanding of disabilities.
In 2024, we were proud to achieve gender parity in
senior roles at the Society (determined by the HM
Treasury Women In Finance Charter), and for
2025 we maintained that position – see here:
Women in finance for further details. Our
partnership with WISE (Women in Science and
Engineering) will support how we continue to
embed gender parity across the Society and
broader Group.
In 2026, our Inclusion and Wellbeing strategy will
continue work on strengthening accessibility and
inclusion throughout our recruitment practices,
utilising expertise from our variety of partners.
Male^
Female
Skipton Group Annual Report & Accounts 2025 27
Our approach to sustainability
As a member-owned business, we have a
responsibility to act in the long-term interests of our
members, colleagues and communities. Our mutual
status means we are member-owned, and we have a
responsibility to our members to remain financially
sustainable, generating profit to invest back into our
businesses for the future benefit of members and to
support sustainable growth.
Our strategy for driving positive change is shaped by
our purpose and reflects the environmental and
social challenges facing the UK today. We focus on
the areas where we can support our members and
communities most effectively, including supporting
people to improve the energy efficiency of their
homes, promoting long-term financial wellbeing and
contributing to resilient, thriving communities. We
continue to align our work with recognised
sustainability themes, including the United Nations
(UN) Sustainable Development Goals and our
banking businesses, the Society and SIL, are
signatories to the UN Principles for Responsible
Banking.
Our separate 2025 Group Sustainability Report
provides further detail on our commitments,
performance and progress throughout the year.
Supporting the transition to more energy-efficient
homes and buildings
Rising energy costs and the UK’s ageing, poorly
insulated housing stock continue to place pressure
on households, hitting those on the lowest incomes
the hardest. Helping our members understand the
benefits of more energy-efficient homes and the
options available to them remains an important part
of our sustainability ambitions.
In 2025, we completed our Big Retrofit project,
retrofitting a Society-owned property in Skipton to
understand first-hand the costs, barriers and benefits
associated with home energy improvements. The
project produced valuable insights which we shared
publicly through two reports, which included policy
recommendations for Government. These learnings
will help inform our member engagement,
proposition development and wider influencing
activity. Further information about the Big Retrofit
project is available on our website.
The Society continue to be members of the
Sustainable Business Consortium and the Wates
Innovation Project, joining other financial services
organisations in exploring green technologies that
could support the transition to more energy-efficient
buildings. This participation helps us explore
practical opportunities to reduce the environmental
impact of our operations and improve the energy
efficiency of our premises.
Supporting our members, customers and
communities
We remain focused on helping members move
forward in life, whether through home ownership,
financial resilience or transitioning to lower-carbon
living. We continue to pledge 1% of our annual Group
profit before tax to charitable causes aligned with
our purpose.
Our three strategic charity partners and the
programmes we supported for 2025 are:
• National Energy Action (NEA)
• Age UK
• Refuge
Performance & Strategy Governance
Financial Statements
Other Information
Skipton Group Annual Report & Accounts 2025 28
Further details of our partnerships and the
programmes we supported during the year can be
found in our standalone Group Sustainability Report.
Responsible supply chain
The Society continues to work in partnership and
closely monitors relationships with key suppliers. On
an ongoing basis we assess any risk of adverse
impact, on our customers, colleagues or the
environment, as a result of these relationships. Our
suppliers are requested to agree with the Society’s
Code of Conduct as part of our onboarding process.
This includes commitment to being a responsible
and sustainable business, as well as supporting our
business ethics and complying with the Modern
Slavery Act 2015.
Suppliers’ service-delivery is tracked against key
performance indicators to ensure the service
provided is of an acceptable standard and the
Society is working with EcoVadis, a sustainability
ratings provider, to assess the sustainability
standards within our supply chain. In 2025, we
assessed 50% of the Society’s critical (“material”)
suppliers on their net zero and energy reduction
strategies.
The approach will be widened to include Connells
next year, enabling a comprehensive analysis to
inform our approach to reducing supply chain
emissions.
We appreciate that this will require supplier
participation and there is a risk that some suppliers
may not participate. The data we collect from this
may, therefore, be limited.
Being Accountable
The Group is committed to a zero-tolerance
approach to instances of bribery or corruption
across any area of our business. We have anti-
corruption and anti-bribery policies in place in each
business line, which are readily available. The
policies provide guidance about what constitutes a
bribe and prohibits the offering, giving, solicitation or
the acceptance of any bribe to or from any person or
company, by any individual colleague, agent or other
person or body acting on behalf of the Skipton
Group. In addition, our colleagues and employees are
required to complete annual training to refresh their
knowledge.
The Society’s Board fully supports the objectives of
the Modern Slavery Act 2015, further details of which
can be found at skipton.co.uk/about-us/governance.
We have a position of zero tolerance of modern
slavery and human trafficking in any form in our UK
business and supply chains. Suppliers to our UK-
based business lines must comply with the Modern
Slavery Act 2015, where applicable, and ensure their
supply chain is transparent about the process
through which employees are managed.
The Group also has regard to the above matters as
part of our risk assessment processes; a full
description of our principal risks and how we
manage these is found in the Risk Review.
To read more on how we keep ourselves
accountable and for details of our corporate
governance, please see the Corporate Governance
Report.
Community Retrofit Hubs
supporting local awareness of home energy
efficiency and retrofit options.
A Place to Call Home
helping older people to live well and
independently in safe, secure and warm homes.
Towards Financial Freedom
supporting survivors to regain financial security
and independence as they rebuild their lives free
from abuse.
Performance & Strategy Governance
Financial Statements
Other Information
Skipton Group Annual Report & Accounts 2025 29
Climate-related risks continue to shape the environment in which financial services organisations operate and
are becoming an increasingly important consideration for the sector. For the Group, understanding how
climate-related factors may affect our members, our operations and our business remains an essential part of
how we navigate this changing landscape.
During 2025, we continued to build our understanding of these risks and opportunities and the implications
they may have for the Group and the markets in which we operate. This work also helped us understand how
we can play our role in supporting the wider transition to a lower-carbon economy in a way that reflects the
needs and circumstances of our members.
Over the following pages, we present our summarised climate-related financial disclosures aligned to the four
pillars of the Taskforce on Climate-related Financial Disclosures (TCFD) framework, the structure adopted by
the International Sustainability Standards Board (ISSB) and the proposed UK Sustainability Reporting
Standards (UK SRS):
Further details on how we manage climate-related risk, and our 2025 performance can be found in the Group
Climate-related Disclosures published on our website.
Performance & Strategy Governance
Financial Statements
Other Information
Governance across the Skipton Group around
climate-related risks and opportunities.
Impacts of climate-related risks and opportunities
on Skipton Group strategy and financial planning
How Skipton Group identifies, assesses, and
manages climate-related risks.
How Skipton Group assesses and manages climate-
related risks and opportunities
Governance Strategy
Risk Management Metrics and Targets
Skipton Group Annual Report & Accounts 2025 30
Board oversight of climate-related risks and
opportunities
The Society’s Board has ultimate responsibility for
oversight of climate-related risks and opportunities
across the Group. The Board Risk Committee
supports the Board in this role, receiving regular
updates and reviewing key climate-related
information during the year.
Board Risk Committee (BRC)
The BRC has received a range of climate-related
information to support its oversight responsibilities,
including:
• Updates on climate-related credit risk
management information
• An update on the Climate-related credit risk
appetite limits
• An update on the Society’s gap analysis in
relation to a PRA climate-related risk consultation
paper
• A review of the Board’s climate risk appetite
statement for the Society
The Board Remuneration Committee
Climate-related performance is linked to
remuneration through the Society’s new Group Long-
term Incentive Plan (LTIP), which includes an ESG
measure aligned to our strategic priorities. The LTIP
applies to the Society’s Executive Directors and other
selected Group Executive Committee members. For
further details, please refer to the Directors'
Remuneration Report.
The Board Audit Committee (BAC)
The BAC is responsible for reviewing and approving
external sustainability reporting, including the
Group’s annual Climate-related Financial
Disclosures.
Board and Executive training
In 2025, specialist training on climate-related risks
and opportunities was delivered for all Board
members and the Group Executive Committee. The
training, led by external specialists, focused on
sector developments, regulatory expectations and
emerging risk themes, supporting effective oversight
and decision-making.
Executive and management oversight
The Group Executive Committee and the boards of
subsidiary firms are responsible for the management
of the financial and operational risks arising from
climate change and the strategy to mitigate these
risks.
Within the Society, climate-related financial risks are
overseen through two key Executive committees:
• Executive Risk Committee (ERC): responsible for
overseeing climate-related scenario analysis and
the integration of climate considerations into the
Society’s risk management framework.
• Group Sustainability Committee: responsible for
overseeing other climate-related risk activity and
wider sustainability matters. This committee
provides a centralised view of the sustainability
and climate risk initiatives and how they connect
and align with the Group’s strategic opportunities.
Responsibility for the identification and management
of financial risks from climate change is held by the
Group Chief Financial Officer as the designated
Senior Management Function in line with the
Prudential Regulation Authority’s (PRA) updated
expectations set out in Supervisory Statement 5/25
on ‘Enhancing banks’ and insurers’ approaches to
managing climate-related risks’.
The Climate Change Risk Forum supports Executive
committees by coordinating activity relating to the
identification and monitoring of climate-related risks
across the Group.
The Stress Testing Steering Committee, reporting
into the ERC, continued to support the development
and reviews of climate-related stress tests and
scenarios analysis during the year.
Subsidiary governance
Subsidiary boards are responsible for managing
climate-related risks relevant to their businesses.
• At Connells, management of risks from climate
change is allocated to Connells’ Chief Lender
Services Officer. Oversight is provided through
Connells’ Audit & Risk Committee, which reports
directly to the Connells board.
• For the other Group subsidiaries, management
responsibility sits with the respective CEOs and
boards.
Performance & Strategy Governance
Financial Statements
Other Information
Governance
Skipton Group Annual Report & Accounts 2025 31
Understanding our climate-related risks and
opportunities
Climate change continues to influence how the
Group delivers its purpose. As the UK transitions to a
lower-carbon economy, we recognise both the risks
climate change presents to our business model and
the opportunities it creates to support our members
and the wider housing market.
We continue to build our understanding of climate-
related risks that may impact the Group, considering
both physical risks and transition risks across the
following time horizons:
We also continue to review the potential
opportunities climate change presents, including
supporting members with home energy efficiency
improvements and enhancing business resilience.
Further details can be found in our standalone Group
Climate-related Disclosures.
Impact on our organisational business, strategy and
financial planning
We continue to consider how both the transition to a
low-carbon economy and the physical impacts of
climate change may affect the Group over time. This
includes assessing climate risks as part of our risk
management framework and our annual going
concern assessment (see the Directors’ Report). An
assessment of climate change on the Society’s
financial position has been conducted and
separately Connells have considered the financial
impact of the risks on its income and costs, business
strategy and financial planning.
The most material potential climate risk impact
continues to relate to credit risk in our residential
mortgage portfolio. Changes in climate have the
potential to increase the frequency and severity of
physical risks, which could lead to an increasing
number of properties subject to physical flooding or
subsidence, for example. This could result in a
decrease in the valuation of the property which is
used as collateral to mitigate mortgage credit risk. In
addition, transitional risks associated with progress
towards a net zero economy could lead to reduced
property valuations or affect a borrower’s ability to
service their mortgage loan.
To manage these risks, we have quantitative Credit
Risk Appetite limits that incorporate the physical and
transition risks identified as high-risk from our
annual climate scenario analysis. We manage our
risk exposures by continuing to evolve our access to
climate information to enhance our lending controls
for flooding and coastal erosion to provide further
physical risk mitigation. We continue to monitor
Energy Performance Certificate (EPC) transition risk
to track mortgage portfolio property retrofitting.
We are also taking action to help the transition
towards a net zero carbon economy, through
initiatives such as EPC Plus home energy reports,
additional borrowing options for energy-efficient
home improvements, and sharing our own
experiences around undertaking retrofit through our
Big Retrofit Project.
Resilience of the strategy - Climate scenario
analysis
Climate scenario analysis continues to form a core
part of our climate risk assessment and supports our
strategic planning and risk appetite. In 2025, we
completed quantitative analysis, with qualitative
assessments for less material exposures across four
climate pathways, including one aligned with limiting
global temperature increases to below 2°C.
The assessment focused primarily on the potential
impact to credit risk in the residential mortgage
portfolio, including a quantitative assessment of
IFRS 9 Expected Credit Losses (ECL), and review of
the impact on the Society’s equity release portfolio.
Qualitative assessments were also completed for
other relevant business areas and Group companies.
For Connells, a review of the same climate pathways
with quantitative modelling of a below 2°C scenario
and additional assumptions for the volume of
properties sold was completed to consider impacts
on property-related income streams and valuation
services.
The 2025 results remain broadly consistent with
prior years. Across the scenarios modelled, the
financial impacts are manageable within the existing
risk management framework. Full details are
available in our Group Climate-related Disclosures.
Performance & Strategy Governance
Financial Statements
Other Information
Strategy
<5 years, aligned with
the Group’s financial planning horizon
5-10 years, covering
the main horizon for key transition risks
10+ years, capturing our
future outlook including key physical risks
Skipton Group Annual Report & Accounts 2025 32
Processes for identifying and assessing climate-
related risk
The Group undertakes an annual climate risk
assessment to identify potential risks that could
result in financial or reputational damage and is
reviewed by members of the Climate Change Risk
Forum (CCRF). Through the CCRF we review climate-
related risks to which the Group is exposed, informed
by internal processes and relevant regulatory
guidance.
The assessment to identify risks involves relevant
subject matter experts from across the Group and
considers the likelihood of risk crystallisation and
potential risk impact to the Group and our
customers.
Processes for managing climate-related risks
Climate risk is incorporated into relevant first line
processes, risk appetites and control frameworks.
With respect to mortgage credit risk, identified as our
key climate-related risk, our current controls for
managing new lending include:
• Physical or desktop inspection of the property for
higher loan to values, where any known flood risk
or risk of coastal erosion will be reflected in the
valuation.
• Desktop or physical survey on properties in
postcodes identified as potentially at risk of
future coastal erosion, to capture local knowledge
of the risks to each property.
• Insurance requirements at the point of
completion, in line with the Society’s loan
conditions, which provides assurance that the
property is insurable at that point in time.
Our concentration risk rules also consider flood risk.
How processes for climate-related risks are
integrated into overall risk management
Our ongoing approach to credit risk management is
carefully considered, based on experience from our
stress scenario analysis, alongside regular
monitoring of any emerging concentration risks
within the mortgage portfolio.
We continue to be prudent and proportionate in our
approach; balancing the risks with any adverse
impacts on our members and the wider UK housing
market.
Climate-related considerations are also incorporated
into our established Risk and Control Self-
Assessment (RCSA) process, supporting regular
assessment of key risks and controls across the
Group.
Risk management framework
Our climate-related risk management processes are
aligned and integrated into the Group Risk
Management Framework.
The Group has a formal structure for identifying and
managing risks throughout the business. This
framework supports the delivery of the Corporate
Plan in line with the Board’s overall risk appetite and
is based upon the three lines of defence risk
management model with risks rated on magnitude
and likelihood.
Climate risk is also managed in other risk areas
through various mechanisms including consideration
as part of the Internal Capital and Liquidity Adequacy
Assessment Processes (ICAAP and ILAAP) and the
inclusion of climate-related risks within our
Operational Risk Framework.
Further details on climate risk are included in the
principal risks section of the Risk Review.
Performance & Strategy Governance
Financial Statements
Other Information
Risk Management
Skipton Group Annual Report & Accounts 2025 33
Metrics used to monitor climate-related risks
To support the monitoring and management of
climate-related risks across the Group, we track a
range of physical and transition-risk indicators,
including:
Skipton Group scope 1, 2 and 3 GHG emissions
Across the Skipton Group we collect data to monitor
and assess energy used and emissions generated
across our operations. Group emissions are reported
under both the market-based and location-based
methods.
Our scope 1 and 2 GHG emissions relate to the
energy we use to operate our branches and offices,
and our company owned or operated vehicles for our
employees. Most of our operations are based in the
UK, with smaller facilities in Australia, Guernsey,
Jersey and New Zealand.
Our scope 1 and 2 location-based emissions have
reduced 12% from 2024, and our energy
consumption is down 3%. Our market-based
emissions have reduced 15% due to increased
purchasing of electricity backed by a renewable
energy of guarantee of origin (REGO), at 91% in 2025
(2024: 86%).
We aim to purchase electricity tariffs, with a
renewable energy guarantee of origin (REGO) for our
Group operations, with the Society purchasing a
green gas tariff, with renewable gas certification
(RGGO).
The work to lower energy used across our offices
and branches has continued throughout 2025,
continuing to switch to more energy-efficient LED
lighting, and installing smart electricity and gas
meters. Additionally, Connells continues the
transition of their fleet to lower emission vehicles,
with 43% of the fleet being hybrid or electric at the
end of 2025.
We report estimated scope 3 data covering financed
emissions from our lending for our residential and
legacy commercial mortgage portfolio (Society and
SIL). The total financed emissions are estimated as
at a 30 September snapshot, based on an LTV-
based attribution ratio, property type, and EPC data
available. We saw an increase in the number of
residential properties with an EPC available, at 84%.
In 2025, the total (residential and commercial)
attributed mortgage financed emissions increased
1% from 2024, in line with growth in the residential
mortgage book.
We recognise that there are certain limitations in the
collection of such data which will affect both the
metrics and our targets, and the usefulness of this
data for our strategic decision-making.
Performance & Strategy Governance
Financial Statements
Other Information
Metrics and targets
(2024: 8,723 tCO
2
e)
Reduction in
Scope 1&2
emissions
• The level of flood risk in the Society mortgage
portfolio over different time periods and
climate pathways.
• The level of subsidence risk in the Society
mortgage portfolio over different time periods.
• The level of coastal erosion risk in the Society
mortgage portfolio over different time periods
and climate pathways.
• Society mortgage portfolio properties by
current and potential EPC category.
• Society quantitative portfolio credit-risk
appetite limits to manage the most material
physical and transition climate risks.
• Connells’ professional indemnity claims
caused by physical climate change.
• Group scope 1 and 2 GHG emissions.
• Estimations of Group scope 3 value chain
emissions.
• Estimations of Group scope 3 financed
emissions intensity for the residential
mortgage portfolio (Society and SIL).
Skipton Group Annual Report & Accounts 2025 34
Targets used to manage climate-related risks and opportunities and performance against targets
We remain committed to reducing the environmental impact of our operations and supporting the UK’s
transition to net zero by 2050.
We have a Group-wide approach to reduce our scope 1 and 2, and selected categories of scope 3 value chain
emissions, in line with net zero by 2050 or earlier. In addition, we have an ambition to reduce our financed
emissions intensity (kgCO2e/m2) of our residential mortgage lending in line with a net zero pathway.
The Board has approved a science-aligned near term 2030 target to reduce our gross scope 1 emissions by
42%, against a 2023 base year. For scope 2, we aim to source 100% REGO-backed electricity. Further
information can be found in the 2025 Group Sustainability Report.
We recognise, to reach our net zero target, there are factors and uncertainties beyond our control and require
the involvement of others including policy makers, governments, suppliers, and customers. We appreciate that
these may impact on our ability to meet our climate-related targets, or make them more challenging, and there
is a risk that all or some of them will not be achieved.
Performance & Strategy Governance
Financial Statements
Other Information
Scope 1 and 2
(notes 2 and 3)
Metric detail
2025 2024
Scope 1
— offices, branches and company vehicles
tCO
₂
e
3,155
3,380
Scope 2 (location
-based) electricity
tCO
₂
e
4,523
5,343
Scope 2 (market
-based) electricity
tCO
₂e
771
1,231
Scope 1 & 2 energy usage (inc. vehicles)
kWh
41,155,847
42,501,013
Total scope 1 & 2 emissions (location
-based)
tCO
₂e
7,652
8,723
Scope 1 & 2 emissions from UK operations (location
-based)
99%
99%
Total scope 1 & 2 emissions (market
-based)
tCO
₂e
3,925
4,611
Scope 1 & 2 location
-based emissions intensity ratio
tCO
₂
e / £m
turnover
4.49
5.39
Scope 3 financed emissions, category 15
(note 4)
Estimated attributed financed emissions
— mortgage lending
from residential and commercial mortgage portfolio
tCO
₂
e
257,350
254,062
Notes
1. Further information on GHG emissions and limitations can be found in the 2025 Group Sustainability Report.
2. Where scope 1 and 2 actuals data was not available, consumption was estimated using average or proxy data. Data for Connells’
acquisition of Ryden and Stiles Harold Williams is for 1 April 2024 to 31 March 2025. Data for the Jade acquisition of Contec
Group International Limited will be included from 1 January 2026.
3. For market-based emissions where consumption was not REGO-backed, a residual or location-based factor has been applied. Our
renewable gas certificates are not used towards emission reductions.
4. Calculated on an annual 30 September snapshot basis, using Partnership for Carbon Accounting Financials emission factors.
The attribution ratio applied is based on the valuation of the property at loan origination. The 2024 figure is restated due to
the application of an improved LTV-based attribution methodology for floor area.
Metrics and targets
Group GHG emissions and energy data (note 1)
Skipton Group Annual Report & Accounts 2025 35
“Collectively, our Group businesses
delivered another year of strong
financial performance, despite
external headwinds and a ‘stop start’
UK housing market; while furthering
our ambitions to support first-time
buyers, broaden access to advice
and make membership matter more.”
Paul Chambers,
Group Chief Financial Officer
Key Financial Performance Indicators
Group profit before tax (PBT) to ensure we generate the capital
necessary to grow the business
Page
36
Underlying Group profit before tax to ensure we generate the
necessary capital to grow the business (note 1)
Page
37
Group net interest margin (% of mean assets) to manage the
earnings of our business
Page
36
Costs to mean assets (Society only) to maintain a manageable
cost base to ensure we remain efficient
Page
38
Retail funding (as a % of total funding) to demonstrate we can
fund most of our mortgages through retail savings
Page
43
Liquidity Coverage Ratio (LCR) (Prudential Group) to ensure we
hold sufficient levels and quality of liquidity (note 2)
Page
41
Common Equity Tier 1 (CET1) ratio (Prudential Group) to
ensure financial strength by having a strong (risk weighted)
capital base (note 2, 3)
Page
44
Leverage ratio (Prudential Group) to ensure financial strength
by having a strong (non-risk weighted) capital base (note 2, 3)
Page
44
£333.4m
£318.6m
£275.2m
2023
2024
2025
Notes
1. Included as a key measure in the Executive Directors’ remuneration policy calculations. For further details see the Directors’
Remuneration Report.
2. The Prudential Group excludes a small number of subsidiaries deemed as immaterial, or where not core to financial services, such as
Connells and Jade.
3. These ratios apply International Financial Reporting Standard 9 (IFRS 9) transitional arrangements for 2023 and 2024; which ceased
to apply from 1 January 2025.
£308.6m
£302.3m
£294.9m
2023
2024
2025
1.53%
1.28%
1.29%
2023
2024
2025
0.72%
0.73%
0.70%
2023
2024
2025
83.2%
85.6%
87.5%
2023
2024
2025
173%
193%
178%
2023
2024
2025
26.0%
28.7%
28.2%
2023
2024
2025
6.7%
6.6%
6.7%
2023
2024
2025
Performance & Strategy Governance
Financial Statements
Other Information
Skipton Group Annual Report & Accounts 2025 36
The Group has performed well in 2025, achieving balance sheet growth, good profitability (albeit down on last
year), and maintaining our strong capital position, despite economic conditions in the UK being subdued.
Economic growth slowed over the second half of the year as households adjusted to tighter fiscal conditions
amidst the effects of prolonged cost of living pressures, while businesses positioned themselves to take the
strain of rising business costs.
Financial performance
Group profit before tax (PBT) was £275.2m (2024: £318.6m). Growth in estate agency and surveying income in
Connells, and mortgage lending volumes in the Society (as housing market activity strengthened modestly),
while growth in cash ISA balances – with savers continuing to prioritise value and security, helped alleviate
underlying pressures from a shifting interest rate environment. The Group also saw an increase in cost base,
particularly at Connells, with rising salaries being the main driver. The Society and SIL also saw an increase in
loan impairment which further dampened profits; while there was a one-off charge for the Society on the buy-
back of Permanent Interest-Bearing Shares (PIBS) in the year.
We have maintained net interest margin, despite the
Bank of England Base Rate of interest being cut four-
times in the year, reducing from 4.75% to 3.75%. Net
interest benefited from favourable cost of funding,
offset by a more competitive mortgage market.
The Society delivered PBT of £189.3m, excluding
income from shares in subsidiary undertakings
(2024: £209.9m). While underlying net interest
margin has remained resilient, the one-off
redemption of £25m of the Society’s Permanent
Interest-Bearing Shares (PIBS) in the year, together
with further investment (people, brand and
technology) as well as increases to our loan
impairment, has ultimately resulted in a lower year-
on-year PBT position. Excluding the £27.9m cost to
redeem the PIBS, as detailed further on page 38, the
Society’s profits were marginally higher than 2024.
SIL reported a profit of £12.1m (£31.0m). The
reduction in SIL PBT was anticipated with the
business purposefully slowing growth, while
investing heavily to continue its transition to better
support customers. This has resulted in significantly
higher salary costs following the growth of back-
office teams.
Connells increased profitability this year, achieving
PBT of £73.1m (2024: £61.3m), as activity continued
to recover in the housing market, particularly early in
the year; buoyed by a surge of property transactions
as buyers rushed to complete purchases ahead of
the changes to Stamp Duty thresholds at the end of
March. However, activity was more subdued
following this.
For the Group, administrative expenses increased in
2025 by £111.1m (up 8.5%) to £1,423.4m (2024:
£1,312.3m). Spend in the year reflects further
investment in our services and our brand, and also in
our people. Salaries across the Group have
increased 10% on last year, through a combination of
rising headcount and higher pay awards as we
continue our focus on providing high levels of
customer satisfaction.
(2024: 1.28%)
Group net
interest margin
Summary Group Income Statement 2025 (£m) 2024 (£m)
Net interest income 514.9 488.4
Fees and commissions receivable 1,208.8 1,109.6
Fair value (losses) / gains on financial instruments mandatorily held at FVTL
(1.9) 18.0
Other operating (expenses) / income (11.0) 3.2
Total income 1,710.8 1,619.2
Administrative expenses (1,423.4) (1,312.3)
Operating profit before impairment loss and provisions 287.4 306.9
Impairment and provisions (12.2) 11.7
Total Group profit before tax 275.2 318.6
Tax expense (66.2) (78.1)
Total Group profit for the year 209.0 240.5
Performance & Strategy Governance
Financial Statements
Other Information
Skipton Group Annual Report & Accounts 2025 37
Alternative performance measures
The Board monitors and reports profits at a statutory level, governed by accounting standards and practices,
and at an ‘underlying’ level to give greater transparency of the performance of the Group’s ongoing trading
activities.
^Comprises fair value movements on the portfolio and associated derivatives, as shown in Note 5 to the Accounts.
Underlying Group Profit Before Tax 2025 (£m) 2024 (£m)
Total Group profit before tax 275.2 318.6
Add back / (less) fair value losses / (gains) in relation to the equity release
portfolio^
6.4 (9.3)
Less fair value gains on share warrants and equity share investments (6.0) (7.0)
Add back fair value losses on the loan to defined benefit pension scheme 2.2 -
Less profit on disposal of subsidiary undertakings (10.8) -
Add back charge on buy-back of Permanent Interest-Bearing Shares 27.9 -
Underlying Group profit before tax 294.9 302.3
Underlying Group PBT - Underlying profit is used to
measure the progress of the Group against its
strategic objectives and the Board uses this measure
to aid in strategic decision-making. The following
items are excluded from statutory profit to arrive at
underlying profit: gains or losses on disposal of
Group undertakings, impairment of Group
undertakings, fair value movements in relation to the
equity release portfolio, and fair value movements in
respect of share warrants, equity share investments,
the loan to defined benefit pension scheme
(following the introduction this year, as outlined in
Note 35 to the Accounts) and Group undertakings.
This reflects the Group’s current strategy and
business model, the majority of these items being
generated from the Group’s investments in other
entities not considered part of the Group’s core
strategy and thus excluded from underlying profit on
that basis.
In the year, the Society completed the successful
buy-back of £25m Permanent Interest-Bearing
Shares (PIBS). This was an exceptional occurrence,
outside of normal trading, and as such, given it does
not represent normal performance, has been
excluded from profit before tax to arrive at
underlying Group PBT.
The other items listed above are excluded from
underlying profit on the following basis:
• Fair value movements in relation to the equity
release portfolio and associated derivatives -
under IFRS 9, the equity release portfolio is held
entirely at fair value, as are the associated
derivatives, with resulting gains / losses taken to
the Income Statement and as a result, the Group
is exposed to significant income statement
volatility. Such gains / losses are therefore
excluded from underlying PBT on the grounds
that they are not reflective of the underlying
trading performance. This is also the case for the
fair value gains or losses on the loan to the
defined benefit pension scheme.
• Fair value gains or losses on equity share
investments and share warrants are recognised
through the Income Statement (except for certain
investments elected to be recognised through
other comprehensive income). As above, we
exclude any gains or losses from the disposal of
Group undertakings, and therefore on the same
basis i.e. not part of the Group’s core strategy, fair
value gains / losses on equity share investments
and share warrants are also excluded from
underlying PBT.
Underlying profit provides greater transparency of
the performance of the Group’s ongoing trading
activities and improves the comparability of
information between reporting periods.
The Group’s policy is to not adjust for amortisation
charges or acquisition costs when calculating
underlying profits. Therefore, amortisation charges
arising from the acquisition of Countrywide by
Connells in March 2021 are included within
underlying PBT - these charges will not recur in the
medium term.
Performance & Strategy Governance
Financial Statements
Other Information
The Group recognised an increase in expected credit
losses on loans and advances to customers of
£10.1m during the year (2024: £17.1m reduction).
This predominantly relates to residential mortgages
in the Homes business, driven by updates to our
underlying economic assumptions, as detailed
further on page 38.
Skipton Group Annual Report & Accounts 2025 38
Performance by segment
The Group’s total profit before tax and underlying profit before tax by key business line was as follows:
^ Information regarding segments that are not separately reportable is combined within the ‘Other’ category, together with
the impact of Group consolidation adjustments.
Society
The Society’s reported pre-tax profit includes a one-
off cost of £27.9m for the buy-back of PIBS in the
year. While the decision to repurchase our PIBS
resulted in a one-off charge to the Income
Statement, this will lead to a £3.2 million interest
saving per year, which will be reinvested into the
Society to deliver our purpose and create real value
for our members.
On an underlying basis, the Society achieved pre-tax
profits of £225.8m for the year (2024: £200.6m).
Net interest income is the income earned on assets
(principally mortgages, other loans and advances,
and liquidity), less that paid on liabilities (principally
retail savings, wholesale funding, subscribed capital
and subordinated debt); which amounted to
£442.2m (2024: £407.2m).
The Society’s net interest margin performed well in
2025 amidst a falling interest rate environment,
improving to 1.18% (2024: 1.14%). A lower cost of
funds within the retail savings market, particularly in
the first half of the year, supported this year-on-year
improvement in margin.
The Society’s net non-interest income, which is
predominantly made up of financial advice fees and
commissions receivable, was £46.2m (2024:
£43.9m).
Administrative expenses for the Society, including
depreciation and amortisation, increased slightly by
£0.4m compared to last year, rising to £262.4m
(2024: £262.0m). We have continued to invest in our
service, through improved digital pathways; and in
our brand and our people, whilst remaining focused
on controlling costs and realising efficiencies.
Despite continued investment, our ratio of costs to
mean assets, a traditional measure of efficiency,
reduced to 0.70% (2024: 0.73%) reflecting our strong
balance sheet growth (as outlined on pages 41 to
44).
A residential mortgage impairment charge of £9.5m
was recorded in the year, which has resulted from
changes to the Group’s forward-looking economic
assumptions, which reflect a greater weighting to
downturn scenarios, as discussed further in Note 1v)
to the Accounts.
This contrasts to last year, where a credit of £14.1m
was realised, with the modelling having taken into
account the reducing Base Rate, following its peak at
5.25% in 2023.
Performance & Strategy Governance
Financial Statements
Other Information
Group PBT 2025 (£m) 2024 (£m)
Society 189.3 209.9
SIL 12.1 31.0
Connells 73.1 61.3
Other^ 0.7 16.4
Total 275.2 318.6
Group Underlying PBT 2025 (£m) 2024 (£m)
Society 225.8 200.6
SIL 12.1 31.0
Connells 56.3 54.3
Other^ 0.7 16.4
Total 294.9 302.3
£225.8m
£189.3m
£12.1m
£12.1m
£56.3m
£73.1m
£0.7m
£0.7m
Society SIL Connells Other
Group
PBT
Group
Underlying
PBT
Skipton Group Annual Report & Accounts 2025 39
Homes
- Our Homes business is designed to provide
finance in order to access the housing market and
‘help more people have a home’.
Gross new mortgage advances in our Homes
business were £6,927m (2024: £5,940m), whilst net
lending was £2,460m (2024: £2,375m). Despite the
uncertain economic environment, the Homes
business again achieved strong net mortgage book
growth in the year of 8.6% (2024: 9.0%), while
maintaining our underwriting standards.
Residential mortgages in arrears by three months or
more totalled 592 cases representing only 0.31% of
mortgage accounts (2024: 541 cases, representing
0.29%). We have seen a small increase in arrears as
cost-of-living pressures continue to flow through to
customers, particularly for those coming off low
fixed rates. However, arrears remain low, and this is
testament to our strong up-front lending controls
and proactive credit management, whereby we
closely monitor and manage mortgages that have
fallen into arrears, working with borrowers to find
solutions that are appropriate for their individual
circumstances.
At the year end, the Homes business’s residential
impairment loss allowance was £20.9m (2024:
£12.8m), with a related debit to the Income
Statement of £9.5m (2024: £14.1m credit), as
detailed on page 38.
The commercial lending portfolio, closed to new
business since 2008, stands at £92.2m (2024:
£114.3m) with an average loan size of £218.6k. The
proportion of accounts in arrears by three months or
more in this portfolio was 2.68% (2024: 1.69%).
The commercial impairment loss allowance stood at
£2.6m (2024: £4.7m), with a related debit to the
Income Statement of £0.3m (2024: £2.9m credit).
The reduction in the impairment allowance, despite
the impairment charge in the year, is due principally
to the write-back of a specific provision made in the
prior year, while the level of allowance required is
reducing over time as this closed book continues to
run-off.
Our Homes business holds an equity release
mortgage book which is closed to new business. We
have seen a net fair value loss on our equity release
portfolio and associated derivatives of £6.4m (2024:
net gain of £9.3m). This net fair value loss is driven
by changes in market expectations of long-term
interest rates, inflation and house price growth.
Refer to Note 15 and Note 18 to the Accounts for further details
on loans and advances to customers and our equity release
portfolio.
Money
- Our Money business helps our members’
‘money work harder’ and combines our savings and
financial advice businesses with our online, branch
and contact centre capabilities.
Savings balances increased by £2,200m in the year,
which represents growth of 7.8% (2024: 8.9%)
compared to the UK savings market where net
savings grew by only 4.4% (Source: Bank of England
Statistics, December 2025). Funds under
management, as part of our financial advice offering,
totalled £5.3bn as at the year end (2024: £4.7bn).
Lifetime ISA (LISA) customers continue to be well
represented in our customer base and at 31
December 2025 we had 164,534 LISA customers
(2024: 167,660) with total balances of £1,126m
(2024: £1,170m), saving hard for their first home or
for later life. These customers benefited from
government bonuses in the year of £45.1m (2024:
£56.2m).
We were the first UK provider to offer a cash Lifetime
ISA upon launch in 2017 and today remain one of the
largest. The Budget announced a consultation will
take place on a new ISA for first-time buyers, and we
look forward to sharing our unique insight to help
shape its future replacement, in order to help even
more people take their first step onto the housing
ladder.
(2024: 9.0%)
Society mortgage
book growth rate
(2024: 0.29%)
Society residential
mortgages in arrears
by three months or
more
Performance & Strategy Governance
Financial Statements
Other Information
(2024: 8.9%)
Savings balance
growth rate
Skipton Group Annual Report & Accounts 2025 40
SIL
2025 saw SIL continue to focus on transitioning the
business, by strengthening its control and regulatory
environment, to provide an improved and robust
offering for its clients. This has had a consequential
short-term impact upon both revenue and
expenditure but is crucial for longer term growth. As
a result, underlying PBT reduced, as anticipated, to
£12.1m (2024: £31.0m).
The decrease in profits reflects a reduction in
interest income due to a combination of strategic
slowdown in growth and external market factors
reducing expected returns on mortgages, which has
impacted SIL’s net interest margin, reducing to 1.62%
(2024: 1.97%). Profit has also been heavily impacted
by related investment spend, with the ratio of costs
to mean assets increasing to 1.15% (2024: 0.81%).
Administrative expenses rose by nearly 40% to
£29.7m (2024: £21.4m) as a result of this
investment, which included increased professional
fees and higher salary expense following the growth
of back-office teams. Last years’ profit was also
bolstered by hedging gains when compared to the
current year.
SIL’s savings book decreased by 2.0% in the year to
£2,369m (2024: £2,418m) while SIL’s mortgage book
decreased by 0.9% to £2,082m (2024: £2,101m);
reflecting a combination of external market forces,
redemptions and the strategic decision to slow
growth. The quality of the mortgage book remains
good with only seven cases in arrears by three
months or more (2024: 10 cases).
2025 marks the end of the transitional period for SIL
with a ‘return to growth’ focus in 2026.
Connells
The UK housing market in 2025 experienced
contrasting dynamics between the first and second
halves of the year.
Connells saw a strong start to 2025, entering with a
higher sales pipeline than at the same time last year.
Momentum in front end sales activity, gained
through late-2024, continued, and was supported by
the Stamp Duty changes; with buyers and vendors
pressing for completion before the 1 April threshold
reductions. Connells benefited from this early-year
stimulus, with March being an outstanding month for
completions.
Market momentum slowed in the second half of the
year however, particularly amidst speculation around
changes to property taxes in the run up to the
November Budget. Despite this, Connells had a
strong year, with increased activity in mortgage
advice and the rental sector.
Underlying pre-tax profit in 2025, excluding £10.8m
profit on disposal of subsidiary undertakings (see
Note 20c) for details), was up 4%.
The number of properties that the business
exchanged contracts on during the year was 9%
higher than in 2024, with the surveying business
benefitting from this increased activity, with the total
number of survey and valuation cases completed in
2025 increasing by 7%.
Connells’ financial services proposition also
continued to perform well. The number of mortgages
arranged increased by 9%, with the value of lending
generated for UK mortgage providers in 2025
totalling £33.3bn (2024: £31.7bn).
The lettings business has continued to grow, with
properties under management increasing to 128,396
at the year end (2024: 126,590). Income from
lettings increased by 4% compared to the prior year
due to the increase in properties under management
and increases in average fees.
Administrative expenses totalled £1,102.5m (2024:
£1,008.9m), an increase of £93.6m (9.3%) on last
year. This was driven in the main by acquisitions
(noted below) and higher salaries, taking into
account wage inflation and the increase to
employer’s National Insurance contributions; with
additional headcount in key strategic areas to
drive growth.
During the year, Connells has continued its
commitment to strategic expansion and has
enhanced its national reach and deepened its client
service capabilities with the completion of several
acquisitions over the year. Further details of which
can be found in Note 20b) to the Accounts.
As the business continues to integrate these
acquisitions, Connells is expected improve
efficiencies and realise future benefits of scale.
Other
SBF generated increased pre-tax profits of £11.6m
(2024: £10.8m). Total drawn funds stood at
£200.6m as at the year end, surpassing last years’
record level (2024: £190.1m), despite client numbers
only increasing modestly to 887 (2024: 871). The
growth in total lending is as a result of SBF’s key
strategic priority to onboard larger client
(2024: £54.3m)
Connells
underlying PBT
Performance & Strategy Governance
Financial Statements
Other Information
Skipton Group Annual Report & Accounts 2025 41
Financial position
Consolidated total assets have increased by 4.4% to £40.7bn at 31 December 2025 predominantly due to our
increased trading. Both residential mortgages and retail savings have seen strong growth in a competitive
market; helping more people have a home and making their money work harder. Our mortgage balances
remain mostly funded by retail deposits, our primary source of funding - in line with our mutual ethos. We also
make use of longer-term funding from the wholesale markets.
In the second half of the year, we made a significant investment to simplify our balance sheet by completing a
successful buy-back of £25m Permanent Interest-Bearing Shares (PIBS). The up-front cost will be offset by the
year-on-year interest saving, in perpetuity.
The Group maintains sufficient levels of high-quality liquid assets in order to support growth plans and
recognise market uncertainty. Stress testing scenarios are regularly run to help ensure we remain within our
liquidity risk appetite and meet all regulatory requirements. Capital resources are in excess of regulatory
requirements, with substantial buffers across risk-based and leverage frameworks.
Liquidity
The Group continues to hold strong levels of liquid
assets to ensure it can meet its liabilities as they fall
due and to help mitigate economic uncertainties.
The Liquidity Coverage Ratio (LCR), a measure
designed to ensure that financial institutions have
sufficient high-quality assets available to meet their
liquidity needs for a 30-day liquidity stress scenario,
was 178% (2024: 193%). The reduction in liquidity
follows repayment of all outstanding ‘Term Funding
Scheme with additional incentives for SMEs’
(TFSME) in the year, as noted on page 43.
The Group’s liquidity levels are closely managed by
senior management and have remained above
internal and regulatory limits throughout the year.
Liquid assets at 31 December 2025 were £6.0bn
(2024: £6.7bn). When measured as a percentage of
shares, deposits and borrowings, the liquidity ratio
remained strong at 16.2% (2024: 19.1%).
Performance & Strategy Governance
Financial Statements
Other Information
transactions and to increase product penetration
across core client sectors, whilst maintaining credit
risk appetite. This, along with new product
deployment, is expected to translate into rising
profits in future years. The quality of SBF’s lending
continues to be good, with impairment as a
percentage of drawn funds remaining low at 0.71%
(2024: 0.78%).
Jade reported a profit of £0.4m for the year (2024:
£1.4m). The acquisition of Contec Group
International in November (as detailed in Note 20b)
to the Accounts) is expected to drive new recurring
revenue for the business going forward.
Summary Group Statement of Financial Position 2025 (£m) 2024 (£m)
Liquid assets 5,982.9 6,694.8
Loan and advances to customers held at amortised cost 33,378.9 30,601.1
Loans and advances to customers held at FVTPL 0.8 0.9
Equity release portfolio 263.1 277.2
Derivatives 350.8 752.1
Fixed and other assets 767.7 689.2
Total assets 40,744.2 39,015.3
Shares 30,526.3 28,268.5
Borrowings 6,408.7 6,786.0
Derivatives 186.2 225.1
Other liabilities 387.2 336.5
Subordinated liabilities and subscribed capital 371.2 731.8
Reserves 2,861.0 2,667.6
Non-controlling interests 3.6 (0.2)
Total liabilities and equity 40,744.2 39,015.3
Skipton Group Annual Report & Accounts 2025 42
At 31 December 2025, the Society held £5.0bn (2024:
£5.8bn) of High-Quality Liquid Assets (HQLA) as
analysed below:
The table above differs to the total amount of liquid assets
shown within the Group’s Statement of Financial Position
(2025: £6.0bn; 2024: £6.7bn) due to certain items that are
excluded from these tables, such as non-HQLA, liquid
assets used as collateral and those used in repurchase (or
‘repo’) transactions.
The Group’s treasury investments are held to provide
liquidity and over 99% (2024: over 99%) of the
Group’s treasury investments, excluding exposures
to a central clearing house used to clear derivatives,
are rated A3 or better. The Group’s policy is that
investments in treasury assets are typically A3 or
better (with the exception of some unrated building
societies where separate credit analysis is
undertaken).
The Net Stable Funding Ratio (NSFR) is a longer-term
stable funding metric, which measures the stability
of our funding sources relative to the assets (e.g.
mortgage balances) we are required to fund. The
Group’s NSFR (2025: 137.7%; 2024: 140.3%) is well
in excess of the regulatory requirement of 100%,
confirming that the Group holds sufficient stable
funding to meet this requirement.
The Group regularly conducts an Internal Liquidity
Adequacy Assessment Process (ILAAP) in
accordance with the Prudential Regulation
Authority’s (PRA) liquidity guidelines and the Board
remains satisfied that the Group has sufficient liquid
assets at its disposal in order to meet its obligations
as they fall due.
Loans and advances to customers
The Group continues to grow its mortgage assets in
a controlled manner, lending within clearly defined
risk appetites through both the Homes business and
SIL. The Group achieved net mortgage growth of
7.9% (2024: 8.2%) with mortgage balances
increasing in the year from £30.9bn at the end of
2024 to £33.3bn. The Group has continued to lend to
a broad range of borrowers, within our credit risk
appetite, throughout the year. New lending, delivered
through both mortgage intermediaries and our own
distribution channels, amounted to £5.9bn (2024:
£6.1bn). Net mortgage lending totalled £2.5bn
(excluding impairment and fair value adjustments for
hedged risk) (2024: £2.3bn).
The average residential loan-to-value (LTV) ratio
(calculated on a valuation-weighted basis) on new
lending has increased slightly to 68.4% (2024:
65.3%). We consider our new lending to remain
prudent and the mortgage book to be well diversified
by geographical location. As at 31 December 2025,
the average valuation-weighted LTV of the total
residential mortgage book (excluding equity release)
was 48.8% (2024: 46.1%).
Our well-managed spread of risk ensures that the
quality of the Group’s lending remains high, as such
we are well placed to deal with uncertainty ahead.
This is evidenced by the proportion of residential
mortgage accounts in arrears by three months or
more which remained low at 0.30% (2024: 0.29%)
excluding non-UK lending; this compares favourably
with the industry average of 0.78% (2024: 0.91%) of
UK mortgages in arrears by more than three months
(Source: UK Finance).
The Group’s commercial mortgage portfolio reduced
in the year by 19.3% to £92.2m. The average LTV of
this portfolio reduced from 42.3% to 38.9% and the
proportion of accounts in arrears by three months or
more in this portfolio was 2.68% (2024: 1.69%).
At 31 December 2025, the fair value of the Group’s
equity release portfolio was £263.1m (2024:
£277.2m). The decrease in fair value of equity
release mortgages is primarily due to movements in
external market rates which form the basis of the
rate at which the portfolio’s cash flows are
discounted to (see Note 18 to the Accounts for
further details).
We aim to support our customers who find
themselves in financial difficulty and where
appropriate we will apply a policy of forbearance,
based on the customer’s individual circumstances
and needs. Ensuring a fair outcome for our
customers is central to our strategy of forbearance,
further details of which can be found in Note 45 to
the Accounts.
Performance & Strategy Governance
Financial Statements
Other Information
Liquidity - HQLA 2025 (£m) 2024 (£m)
Balances with the
Bank of England
1,358.4 1,928.6
Gilts 492.5 885.5
Treasury bills 233.2 321.3
Fixed rate bonds 1,531.0 1,267.6
Residential mortgage
backed securities
619.0 619.9
Covered bonds 813.5 770.1
Total 5,047.6 5,793.0
Skipton Group Annual Report & Accounts 2025 43
Retail funding
As a mutual building society we remain committed
to providing savers with competitive returns along
with offering excellent customer service, which is
reflected in the 7.8% increase in retail savings
balances during the year, as detailed on page 39.
In addition to our UK retail funding, the Group also
accepts deposits through SIL (our Channel Islands
based business). SIL’s funding base totalled £2.4bn
(2024: £2.4bn); these balances are included in
‘Amounts owed to other customers’ within the Group
Statement of Financial Position.
Wholesale funding
At 31 December 2025 the Society’s wholesale
funding ratio was 12.5% (2024: 14.4%), with £4.0bn
(2024: £4.4bn) of our funding coming from the
wholesale markets, as analysed below:
In May, the Society issued a £500m 5-year covered
bond. The cash from this transaction, together with
general growth in retail savings balances, was used
to repay the outstanding £1.0bn of the Bank of
England’s ‘Term Funding Scheme with additional
incentives for SMEs’ (TFSME). The Society no longer
has any TFSME payable (31 December 2024:
£1.0bn).
The Society issued a second £500m 5-year covered
bond transaction in September.
The credit ratings of the Society are assigned by two
major credit rating agencies, Fitch and Moody’s. In
September 2025 Fitch affirmed the Society’s Long-
Term Issuer Default Rating (IDR) at ‘A-‘ with a Stable
Outlook, Short-term IDR at ‘F1’ and Viability Rating
(VR) at ‘a-‘. In June 2025 Fitch also affirmed the
Society’s mortgage covered bonds at ‘AAA’ with a
Stable Outlook. In June 2025 Moody’s affirmed the
Society’s Baseline Credit Assessment (BCA) at ‘A3’,
it’s ‘A2’ long-term deposit and senior debt ratings
with a Stable Outlook, and Short-term at ‘P-1’.
Moody’s also assigns ‘Aaa’ to the Society’s
Mortgage Covered Bonds. The ratings reflect the
continued financial strength of the Society, which
compares favourably to other large building
societies.
The Society’s current credit ratings, which have not
changed since 2021, are summarised below:
The Class A Notes of our rated securitisation
transaction (Darrowby No. 6 plc) is ‘Aaa’ rated by
both agencies.
Funding
Through our Money business, we continue to
manage the mix of retail and wholesale funding in
the best interests of members. Optimising the mix of
retail and wholesale funding is essential to achieving
both our retail savings and lending growth
objectives.
We maintain a diverse funding portfolio to prevent
over-reliance on one source and, taking into
consideration the term profile of our lending, closely
manage the term of our funding in order to manage
the risks of duration mis-match.
We remain primarily funded by retail savings.
Notes
1. Excludes shares held by others and fair value adjustments
totalling £358.4m (2024: £325.0m) which are classified as
wholesale funding.
2. Wholesale funding balances exclude £2,368.5m (2024:
£2,417.7m) of offshore funding in our Channel Islands based
business, SIL.
Wholesale Funding 2025 (£m) 2024 (£m)
Repo and other
secured agreements
165.9 1,019.2
Deposits 512.4 913.8
Certificates of
deposit
- 5.1
Covered bonds 2,941.3 1,934.9
Securitisation 398.3 491.6
Fair value
adjustments
22.3 3.7
Total 4,040.2 4,368.3
Credit Ratings Fitch Moody’s
Covered bonds AAA Aaa
Senior Preferred A A2
Baseline Credit
Assessment (BCA)
N/A A3
Issuer Default Rating
(IDR)
A- N/A
Short Term F1 P-1
Senior Non-Preferred A- Baa1
Outlook Stable Stable
Last change of rating August
2021
July 2021
Funding 2025 (£m) 2024 (£m)
Shares held by
individuals (note 1)
30,167.9 27,943.5
Wholesale funding
(note 2)
4,040.2 4,368.3
Total 34,208.1 32,311.8
Performance & Strategy Governance
Financial Statements
Other Information
Skipton Group Annual Report & Accounts 2025 44
In December, as a result of our strong capital
position, we took the opportunity to simplify our
balance sheet, by way of a liability management
exercise to buy back our £25m, 12.875% legacy Tier
2 eligible PIBS at a fair price. This reduced capital (as
detailed below) but will deliver interest savings, as
part of a more efficient capital model.
Capital (unaudited)
Common Equity Tier 1 (CET1) capital comprises
principally the general reserve and subscribed capital
provided through Permanent Interest-Bearing Shares
(PIBS), with the addition of a small number of
regulatory adjustments.
We monitor regulatory capital against the
requirements set by the PRA for both the Society and
the consolidated Prudential Group (PG). The PG
consolidation simply excludes a small number of
subsidiaries deemed as immaterial or not core to
financial services.
PG capital requirements are higher than for the
Society, therefore, the analysis throughout this
Capital section has been disclosed at a PG level only.
Total regulatory capital has increased by £174.9m
from 31 December 2024 to £2,590.0m as at 31
December 2025 (2024: £2,415.1m). This is mainly
due to the retained profits accumulated during 2025.
Risk Weighted Assets (RWAs)
RWAs have increased by £864.0m in the year to
£9,141.4m (2024: £8,277.4m). This increase is
principally driven by strong residential mortgage
book growth in the year.
The Society continues to work with the PRA to
update its IRB rating system to meet the latest
regulatory requirements. Until the new IRB rating
system is approved a temporary model adjustment
(TMA) is applied to the Society’s regulator-approved
IRB model output at portfolio level. The TMA uplifts
the expected loss (EL) and RWAs to the level
expected in the revised IRB models.
The TMA remains subject to change and may cause
variations in the capital metrics. There have not
been, and we do not expect there to be, any material
changes to the risk profile or strategy of the Society
as a result of changes to the TMA.
The CET1 ratio has decreased by 0.5% as growth in
RWAs outpaced the increase in CET1 capital.
The leverage ratio increased marginally by 0.1%.
Capital composition
The following table shows the composition of the PG
regulatory capital as at 31 December 2025. IFRS 9
Financial Instruments
transitional arrangements are
applied throughout 2024 and ceased to apply from 1
January 2025.
Capital management
The Group is regulated by the PRA and is required to
manage its capital in accordance with the rules and
guidance issued by the PRA under CRD V, the UK
CRR and the PRA rulebook.
(2024: 28.7%)
CET1 ratio
Regulatory Capital 2025 (£m) 2024 (£m)
Capital resources
CET1 capital 2,575.0 2,375.1
Total Tier 1 Capital 2,575.0 2,375.1
Total Tier 2 capital 15.0 40.0
Total regulatory
capital
2,590.0 2,415.1
RWAs 9,141.4 8,277.4
Capital and leverage ratios
CET1 capital 28.2% 28.7%
Tier 1 ratio 28.2% 28.7%
Total capital ratio 28.3% 29.2%
Leverage ratio 6.7% 6.6%
(2024: 6.6%)
Leverage
ratio
Performance & Strategy Governance
Financial Statements
Other Information
Skipton Group Annual Report & Accounts 2025 45
The Group completes an Internal Capital Adequacy
Assessment Process (ICAAP) at least annually to
assess current and projected capital requirements to
support the current risks in the business and future
risks arising from the Corporate Plan. The ICAAP
considers all of the Group’s material risks and
includes Board-approved stress scenarios which are
intended, as a minimum, to meet regulatory
requirements.
Pillar 1
The Group holds capital to meet Pillar 1
requirements for credit risk, operational risk, and
market risk. The IRB approach is used to calculate
the capital for the majority of residential mortgages
in the Group, and for equity and non-credit obligation
exposures.
The standardised approach is applied to all other
exposures relating to operational risk and market
risk, except for securitisations. The External Ratings-
Based Approach is applied for securitisation
investments.
Pillar 2A
The PRA requires the Group to hold additional Pillar
2A capital for risks not covered under Pillar 1. At 31
December 2025 this was £236.1m (2024: £170.2m).
The combination of Pillar 1 and Pillar 2A
requirements form the Group’s Total Capital
Requirement (TCR).
Minimum Requirement for Own Funds and Eligible
Liabilities (MREL)
MREL is a regulatory requirement set by the Bank of
England to ensure institutions can cover losses that
would need to be absorbed in the event of a potential
failure of the business. The amount of MREL that
institutions need to have is linked to the resolution
strategy chosen for each firm. The Bank of England’s
preferred resolution strategy for the Society is a
single point of entry bail-in under Part 1 of the
Banking Act 2009.
The Group maintained strong capital headroom over
its MREL requirement, enabling £350m of senior
non-preferred debt to settle at maturity during
October 2025 without being replaced.
Further information on the Society's financial strength can be
found in the Group’s Pillar 3 Disclosures, which are published on
the Society’s website skipton.co.uk.
Taxation
The Group tax charge for the year is £66.2m (2024:
£78.1m) with an effective tax rate of 24.2% (2024:
24.6%). For the Society, the tax charge for the year is
£49.5m (2024: £56.7m) with an effective tax rate of
18.2% (2024: 23.1%). In addition to UK corporation
tax payable on its profits, the Society’s taxable
profits above £100m are subject to a 3% banking
surcharge which increases the tax charge for 2025
by £2.3m (2024: £3.3m) for the Group and £2.6m
(2024: £3.3m) for the Society. The Group’s effective
tax rate is offset by the impact of lower tax rates in
other jurisdictions, whilst the Society’s effective tax
rate is also impacted by non-taxable dividend income
of £82.8m (2024: £36.0m).
A reconciliation of the effective tax rate to the
statutory tax rate in the UK is provided in Note 12 to
the Accounts. More detailed tax disclosures are
provided in Note 34 to the Accounts and in the
Country by Country Reporting section.
Further details of the Group’s taxation strategy can
be found at www.skipton.co.uk/about-
us/governance.
Taxes borne are a direct charge impacting the
financial results of the Group - the table below shows
the total UK tax contribution borne in the year:
UK taxes collected in the year comprised the
following:
Taxes borne 2025 (£m) 2024 (£m)
Employment taxes 99.4 79.7
Corporation tax paid 54.2 64.0
Irrecoverable VAT 20.4 22.5
Taxes on property 18.4 18.9
Economic Crime Levy 1.4 0.4
Total 193.8 185.5
Performance & Strategy Governance
Financial Statements
Other Information
Taxes collected 2025 (£m) 2024 (£m)
PAYE 127.8 115.4
National Insurance 30.2 29.9
Stamp Duty Land Tax
(SDLT)
29.8 19.4
Net VAT 145.7 135.0
Total 333.5 299.7
Skipton Group Annual Report & Accounts 2025 46
Pension funds
The Group manages three funded defined benefit schemes as described in Note 36 to the Accounts. Using the
methodology set out in IAS 19
Employee Benefits
, the aggregate valuation of the three schemes at 31
December 2025 was a combined deficit of £7.4m (2024: £3.8m deficit).
We continue to take steps to manage the Group’s exposure to the schemes and all schemes are closed to new
members and to future accrual of benefit. The actuarial valuation deficits, as described in Note 36 to the
Accounts, are used to judge the level of contributions that should be made and a schedule of deficit
contributions has been agreed between the Trustees and the Group.
On 31 January 2025, as part of a strategy to de-risk the Society’s exposure to its defined benefit obligation, the
Skipton Building Society (2015) Group Pension Scheme was subject to an insurer buy-in. The majority of the
Scheme’s defined benefit obligations to members are now insured under a policy held by the Scheme,
significantly reducing exposure to investment and longevity risk; certain obligations are not insured, for
example any future impact of the application of Guaranteed Minimum Pension (GMP) equalisation
requirements to historical transfers out of pension schemes.
Ahead of the insurer buy-in transaction, in January 2025, the Group made two payments to the Scheme to
facilitate the full scheme buy-in. The first was a loan to the Scheme of £14.6m in recognition of the fact that
the Scheme held illiquid assets of the same value. The loan is repaid as the illiquid assets currently held by the
Scheme mature. The second was a payment of £10.7m to top up the Scheme’s assets to the buy-in policy’s
value of £105.0m.
During the year, the Countrywide defined benefit pension scheme was subject to a full insurer buy-out. As a
result, all major obligations and associated assets were transferred to an insurance provider. There is only a
small portion of assets and liabilities remaining in the balance which is expected to be settled in 2026. No
settlement gain/loss has been recognised in the income statement following the buyout.
The pension Trustees will continue to monitor and manage the pension schemes in a responsible manner,
working with the employer to share the aim of ultimately eliminating the actuarial funding deficit.
The Group also operates defined contribution schemes into which eligible employees are automatically
enrolled.
Performance & Strategy Governance
Financial Statements
Other Information
Skipton Group Annual Report & Accounts 2025 47
The UK growth forecast remains subdued, with only modest economic expansion recorded through 2025.
Inflation continued to fluctuate throughout the year and is forecast to gradually ease through 2026 while
remaining above the Bank of England 2% target. Unemployment has edged up gradually over the year,
reflecting a soft labour market and cautious business sentiment amid ongoing global uncertainties and
persistent geopolitical tensions.
The Bank of England’s decision to lower interest rates in the second half of 2024, followed by further gradual
reductions in 2025, has contributed to improved credit conditions. Shifting customer behaviours and
preferences, particularly in digital engagement and financial services, continue to create both opportunities
and challenges across our diversified Group.
Despite some ongoing uncertainty with the economic and political environment in 2025, the Society’s and SIL’s
mortgage books remained resilient and are not showing any material signs of stress. We are closely
monitoring our key risk management metrics so that proactive action can be taken should this be required. We
remain vigilant for any credit deterioration in the year ahead and are ready to support any member who may be
concerned about facing financial difficulty.
The results of Connells are principally driven by the volume of UK property transactions, in particular second-
hand property sales. This market is heavily influenced by consumer confidence, driven by the general state of
the economy, level of unemployment and interest rates, together with the availability of mortgages, particularly
for first-time buyers.
Any slowdown in the housing market puts pressure on Connells’ income levels, but the business is partially
protected against the performance of its core business through its own diversification into complementary
businesses such as lettings and property asset management. Through our estate agency division, we are
carefully monitoring the housing market, and expect growth to be geographically uneven, with some regions
projected to see stronger growth than others.
Principal risks
The outlook for the Group remains cautiously positive. Persistent economic challenges remain, alongside
ongoing uncertainty regarding the long-term direction of government policy following the 2024 General
Election. Aside from these factors, the Directors do not consider that the principal risks and uncertainties
affecting the Group have changed materially since the publication of the 2024 Annual Report and Accounts
and the interim Half-Yearly Financial Report 2025. However, our principal risks continue to evolve and will be
managed throughout 2026 and beyond.
The principal risks presented on the following pages are those that are inherent to the Group’s business model
and strategy, as well as the economic environment in which the Group operates. During the year, all risks that
our business is exposed to are assessed for severity and evaluated based on their likelihood and potential
impact. Risks are managed through the Group’s internal control framework, with key mitigation strategies
highlighted below.
Performance & Strategy Governance
Financial Statements
Other Information
Skipton Group Annual Report & Accounts 2025 48
Performance & Strategy Governance
Financial Statements
Other Information
Capital Risk
Risk definition:
The risk of not maintaining sufficient capital and MREL (minimum requirement for own funds
and eligible liabilities) to support day to day operations, withstand stressed economic conditions and meet
regulatory requirements.
Risk management and mitigation
The Capital Management Framework governs the capital adequacy and allocation processes in normal and
stressed conditions. This is supported by monthly reporting of the capital and MREL requirements to Board.
The Internal Capital Adequacy Assessment Process (ICAAP) is conducted to assess the Society’s and the
Prudential Group’s current and projected capital and MREL requirements to mitigate the current risks in the
business and any future risks arising from the Corporate Plan.
The Group currently adopts the following
approaches to calculating its Pillar 1 minimum capital requirements:
• Internal Ratings-Based Approach (IRB) for the residential mortgage exposures of the Society.
• IRB approach for exposures relating to investments in subsidiaries outside the regulatory group and non-
credit obligation assets (property, plant and equipment, fair value adjustments for hedged risk and cash).
• Standardised approach for other lending exposures.
• Standardised approach for treasury portfolios.
• Standardised approach for operational risk and market risk
.
Within the ICAAP we consider the impact of emerging capital regulation over the Corporate Plan horizon,
including the reforms to the Basel III regulation, and how we expect to meet those requirements
. A Recovery
Plan is maintained which provides a suite of viable options and actions to restore the Society’s financial
strength in the event of a severe capital and/or liquidity stress in compliance with associated regulations.
Climate Risk
Risk definition
: The risk of the commercial impact that climate and environmental changes present to our
business model.
Risk management and mitigation
Climate change presents a range of risks and opportunities to the Group, our members and customers. These
include both physical risks and transition risks. The
Sustainability Governance Framework supports the
management of climate
-related risks in accordance with risk appetite and regulatory expectations.
Climate
-related risks are assessed through annual climate risk stress and scenario testing. The analysis is
focused on a quantitative assessment of the impact of climate change on our residential mortgage portfolio,
while also considering potential impacts across the wider Group.
Lending controls are in place to manage physical climate risks within the mortgage book, with regular climate-
related management information
provided to the Board Risk Committee.
Conduct Risk
Risk definition
: The risk of delivering poor or inappropriate outcomes for customers.
Risk management and mitigation
Ensuring fair value and good customer outcomes across our channels, products and services, including more
tailored support for our vulnerable customers where required, remains a priority in line with the requirements
of Consumer Duty.
All product launches, product withdrawals, pricing, and contractual changes are reviewed, validated and
approved through internal governance, ensuring alignment with Corporate Plan and Consumer Duty principles.
The competency and oversight of our colleagues to ensure we provide good outcomes for our customers is
regularly assessed to maintain the confidence and trust upon which our brand is based. Our Quality
Framework ensures regular risk
-
based assurance is undertaken to confirm customers receive good outcomes
in their interactions with us.
Skipton Group Annual Report & Accounts 2025 49
Performance & Strategy Governance
Financial Statements
Other Information
Credit Risk
Risk definition
: The risk of financial losses or adverse impacts on the business’s performance and solvency
due to the failure of its borrowers to meet their contractual obligations.
Risk management and mitigation
The Group faces credit risks from its lending to individual customers (retail mortgages); to businesses through
debt factoring, invoice discounting and asset
-
based lending; and to wholesale counterparties for the purposes
of liquidity management.
Retail and commercial credit exposures are managed and monitored by a team of experienced professionals,
with oversight provided by the Retail Credit Committee, underpinned by an established credit risk appetite
framework.
The credit decisioning process applies credit scoring, affordability assessment and lending policy criteria
which is supported by manual underwriting and model risk management practices.
The Credit Management function supports effective arrears management, with early intervention central to its
approach. Borrowers in financial stress are proactively engaged, and forbearance is considered case
-by-
case,
in line with industry standards.
Economic Crime
Risk definition
: Financial losses, regulatory penalties, and reputational damage resulting from fraudulent
activities, money laundering, terrorist and proliferation financing, bribery, corruption, or other illicit behaviour
by the business, its employees, or associated third parties.
Risk management and mitigation
Economic crime risk is managed through a comprehensive framework that establishes clear principles,
responsibilities, and procedures for identifying, preventing, and responding to this principal risk. This
framework ensures compliance with legal and regulatory obligations while safeguarding members and
customers from financial crime. It also mitigates reputational and operational risks through robust
governance and oversight. Key controls include rigorous customer identity and verification processes,
alongside ongoing transaction monitoring, to detect and reduce the likelihood of fraudulent account activity.
Legal and Regulatory Risk
Risk definition
: Financial losses or adverse outcomes arising from failure to comply with applicable laws,
regulations, and industry standards, as well as risks related to contractual agreements, litigation, and
changes in legislation, and corporate governance issues.
Risk management and mitigation
The Society manages legal and regulatory risk through a robust Policy and framework that combine first
-line
business ownership with specialist support from Legal, Compliance, and Prudential Risk teams. Business
units are accountable for embedding appropriate policies, procedures, and oversight to ensure compliance
with applicable laws, regulations, and industry standards. This approach is informed by proactive horizon
scanning to identify emerging regulatory developments and adapt accordingly. To provide assurance, second-
line functions conduct risk
-based reviews to assess control effectiveness and identify any areas of non-
compliance, delivering oversight and reassurance to senior management.
Skipton Group Annual Report & Accounts 2025 50
Performance & Strategy Governance
Financial Statements
Other Information
Liquidity, Market and Funding Risk
Risk definition
: The risk of being unable to meet current and future financial obligations as they fall due, or
only able to do so at excessive cost, and the risk to earnings or capital resulting from adverse movements in
interest rates.
Risk management and mitigation
The Group manages liquidity, market, and funding risks through a robust Treasury Policy that sets principles,
limits, and governance for these exposures within the Board’s approved risk appetite. Group Treasury is
responsible for implementing this policy, supported by strong oversight from the Asset & Liability Committee
(ALCO) and its sub
-committees, with regular reporting to the Board Risk Committee and the Board.
Liquidity and funding risks are managed through a strategy that ensures sufficient and diversified liquidity to
meet regulatory requirements and support the Corporate Plan, complemented by contingency arrangements
and stress testing under the Internal Liquidity Adequacy Assessment Process (ILAAP).
Market risk, including interest rate risk, is mitigated through hedging strategies using derivatives within
defined limits, while wholesale credit risk is controlled through counterparty limits, collateral arrangements,
and oversight by the Group Wholesale Credit Committee. These measures collectively ensure resilience under
normal and stressed conditions, safeguarding the Group’s financial stability.
Model Risk
Risk definition
: Model Risk is the potential for adverse consequences from model errors or the inappropriate
use of modelled outputs to inform business decisions. These adverse consequences could lead to a
deterioration in the business’ financial strength, non
-compliance with applicable laws and/or regulations, or
damage to a firm’s reputation.
Risk management and mitigation
The Group manages model risk through a dedicated Model Risk Committee (MRC), which provides oversight
in line with a Board
-approved Model Risk Appetite, Policy and Framework. The MRC monitors model
performance, regulatory compliance, and emerging risks, reporting regularly to the Executive Risk Committee
and Board Risk Committee.
As the use of models to support strategic and business decisions continues to grow, the Group invests in
robust model risk management practices, including enhanced governance, policies, and standards to meet
evolving regulatory requirements.
Recent regulatory changes, such as updates to Internal Ratings
-Based (IRB) modelling approaches, have
driven significant investment in model development and validation. Our suite of IRB models are being further
developed to align with updated regulatory requirements, and in the interim, a temporary model adjustment
(TMA) has been applied to ensure expected loss and risk
-weighted assets remain aligned with regulatory
expectations.
These measures ensure that model risk is effectively managed and mitigated across the Group.
Skipton Group Annual Report & Accounts 2025 51
Performance & Strategy Governance
Financial Statements
Other Information
Operational Risk
Risk definition
: The risk of losses, resulting from inadequate or failed internal processes, people and
systems or from external events.
Risk management and mitigation
The key operational risks the Group face include:
• Change Demand and Delivery: Balancing day-to-day operations with transformation initiatives requires
robust governance. Our Change Management Framework ensures all changes are assessed, governed, and
implemented in a controlled, risk-aware manner through structured planning and review.
• Data Management and Protection: Customer data is safeguarded through robust governance and data
management frameworks. Our approach ensures secure processing, quality maintenance, and appropriate
retention throughout the data lifecycle.
• Information Security (Cyber Threat): We remain vigilant against the growing global cyber threat.
Cybersecurity controls are continuously strengthened with evolving industry standards, covering network,
encryption, and access management to protect our customers and colleagues. We operate an overarching
Information Security Framework, Access Control Policy and Security Incident and Event Management
Framework and continue to invest in automating cyber controls, educating colleagues on the latest
technology and information to further enhance resilience and awareness.
• Operational Resilience: We maintain a strong focus on operational resilience, ensuring the ability to
prevent, respond to, and recover from any disruptions. Regularly tested business continuity plans support
controlled, documented, and risk-aware continuity across all business areas. We also continue to
strengthen controls, governance, and knowledge by leveraging insights from the latest incidents both
within our business and across the wider financial services sector, ensuring lessons learned drive
continuous improvement.
• Payment Processes: This risk is managed through automated workflows, exception reporting, continuity
and contingency processes and strong oversight. Financial integrity and compliance is maintained through
automated reconciliation, segregation of duties, and variance checks to ensure accurate and timely
processing.
•
Physical Security and Safety: We safeguard colleagues, customers, premises, and physical assets through
policies which regulate access, ensure visitors are authorized, and monitored, and enforce procedures
such as entry controls and surveillance. Regular reviews and testing strengthen these measures, mitigating
risks including unauthorized access, theft, and data breaches.
• Technology: IT Service Management provides controls to help technology services withstand, recover
from, and adapt to any disruptions without impacting critical operations. Key practices include managing
end-of-life technologies, implementing disaster recovery and failover protocols, responding to incidents,
and monitoring capacity and performance.
• Third-Party and Supply Chain Risk: We manage this risk through strong procurement and supplier
management processes, ensuring material suppliers maintain services under stressed conditions.
Continued investment supports resilience amid a growing dependency on external providers.
Skipton Group Annual Report & Accounts 2025 52
Performance & Strategy Governance
Financial Statements
Other Information
Reputational Risk
Risk definition: Failure to manage the potential loss or damage to the Group’s reputation arising from actions
/ behaviours / external outcomes.
Risk management and mitigation
The Group’s reputation is safeguarded through effective external communications, marketing, public affairs,
and robust issue and crisis management preparedness. A dedicated Crisis Response Framework ensures
swift, consistent, and transparent action during incidents that could impact brand integrity, defining clear
roles, escalation paths, and messaging protocols to maintain stakeholder trust.
The Group also invests in its control environment and focuses on delivering member value through high
-
quality service, competitive products, and good customer outcomes. These measures, combined with ongoing
monitoring and purposeful engagement, help mitigate reputational risk and protect the Group’s long
-term
resilience.
Regulatory, Financial Reporting and Tax Risk
Risk definition: Financial losses, penalties, or reputational damage due to failures in accurately preparing and
submitting financial reports, regulatory reports, complying with tax laws and regulations, or implementing
effective tax planning strategies.
Risk management and mitigation
The Group manages Regulatory, Financial Reporting, and Tax Risks through a comprehensive framework
overseen by the Group CFO. This includes robust policies, procedures, and internal controls designed to
ensure compliance with applicable laws, accounting standards, and regulatory requirements. Governance is
supported by clearly defined roles and responsibilities, skilled personnel, and strong oversight through the
three lines of defence model, with regular reporting to senior committees and the Board.
Financial reporting controls include formal attestations, reconciliations to approved source data, and system
-
enforced transaction validations to ensure accuracy and completeness. The Group maintains proactive
engagement with regulators and auditors, supported by horizon scanning and specialist advice where
required, ensuring transparency and resilience in managing these risks.
People Risk
Risk definition
: Financial losses or operational disruptions arising from misconduct, fraud, inadequate
training, or ineffective management and oversight of the businesses’ employees and workforce.
Risk management and mitigation
The Group Executive Committee and subsidiary leadership teams are accountable for identifying, managing,
and escalating any workforce
-related risks — such as talent, conduct, culture, wellbeing, and capability.
Oversight is maintained through People Partners, formal governance forums including the Executive People
Committee, and Board reporting.
Key indicators such as colleague engagement, grievances, legal claims, turnover, recruitment, and mandatory
learning are monitored alongside regulatory developments. A comprehensive suite of People Policies
underpins this approach, covering areas such as pre
-
employment screening, whistleblowing, health and safety,
and reward, ensuring compliance and alignment with Group values. Where issues arise, the Group acts
promptly to investigate, remediate, and apply lessons learned to strengthen controls.
Skipton Group Annual Report & Accounts 2025 53
Performance & Strategy Governance
Financial Statements
Other Information
Emerging risks and uncertainties
In addition to the principal risks, the Group actively considers emerging risks that could impact long-term
viability and the delivery of strategic objectives. These risks are regularly monitored to ensure timely oversight
and appropriate mitigation. The most significant emerging risks are described below, together with mitigating
actions we are taking to manage the risk:
Risk description Mitigation
Economic environment and geopolitical
A significant escalation in
ongoing or new conflicts, a
significant change in
government policy or
sudden economic impacts
to the housing market,
could detrimentally impact
growth plans.
Macroeconomic and geopolitical risks continue to be closely monitored
across all Group businesses, as the near
-term outlook remains uncertain.
Risks associated with the housing market and future trajectory for UK inflation
and interest rates are closely managed as part of our strategic planning, to
ensure any potential consequences can be considered and acted on in a timely
manner. The Group regularly conducts stress tests based on economic
conditions to ensure we can withstand severe yet plausible scenarios.
Continued monitoring of both direct and potential secondary impact risks
associated with ongoing or new conflicts remains a key consideration.
The impact of changes to existing or new government policies are closely
monitored.
Technology
and innovation
Potential for losses or
operational disruptions
that can arise from the use,
ownership, operation,
influence, and adoption of
technology e.g.
cybersecurity, Artificial
Intelligence (AI), Cloud,
third party risk
management.
The Group continues to strengthen our governance, processes and controls,
including robust cybersecurity measures, regular system maintenance, and
disaster recovery planning.
We continue to monitor the development of AI technologies closely and
consider the associated risks across multiple areas. Informed decision making
enables us to strike a balance between the opportunities of utilising
technology such as Cloud, and managing any associated risks, to ensure our
technology and processes are secure and resilient by design.
Strategic / Business Risk
Risk definition:
Failing to formulate and deliver the strategy and/or a lack of response to changes in the
external environment affecting the sustainability of the business.
Risk management and mitigation
The Corporate Plan sets the strategic direction aligned with the Group’s values and risk appetite, ensuring
coordinated delivery and strong oversight. Risk appetite acts as a key governance control, guiding decision
-
making and setting boundaries for risk
-taking to maintain alignment with regulatory expectations.
Business risks, including revenue volatility, market changes, and evolving customer behaviours, are assessed
through regular strategic analysis, and stress testing. In line with regulatory requirements, the Group maintains
recovery plans detailing actions to sustain operations under severe stress scenarios. These measures
collectively support resilience and enable the Group to adapt to changing conditions while protecting long
-
term sustainability.
Skipton Group Annual Report & Accounts 2025 54
Performance & Strategy Governance
Financial Statements
Other Information
Risk description Mitigation
Regulatory
environment
Potential for losses or
adverse outcomes arising
from failure to comply with
applicable laws, regulations,
and industry standards.
Well established processes are in place to support compliance with existing
and new regulations across the Group.
We engage proactively with regulators and industry bodies to stay ahead of
regulatory changes and emerging requirements. By maintaining a forward
-
looking approach, the Group aims to manage regulatory risks effectively,
safeguard our members’ interests and support sustainable growth in a
dynamic landscape.
Operational
resilience
A major operational risk
event such as a cyber
-
attack or national
infrastructure failure could
disrupt our ability to
provide key services to
members and customers.
The Group carefully plans for different possible situations to ensure we are
ready to handle and recover from major risk events. We also invest in our IT
systems and operations to improve overall resilience and our ability to
respond quickly to new and changing threats.
We have robust procurement and supplier management policies to ensure that
outsourced service providers can maintain their services and service
standards, even in a stressed environment.
Environmental,
Social and Governance (ESG) and Climate risk
The risk associated with
increased supervisory
expectations and
regulatory requirements for
ESG and disclosure
requirements.
The Group is committed to embedding the management of ESG and climate
risk across its businesses. Our 2025 Group Sustainability Report details our
approach to managing these risks.
The Group will continue to review available data sources and enhance our
methodology and processes to improve the robustness of our ESG
governance and reporting, aligned with emerging developments and regulatory
requirements in 2026 and beyond.
Changing
customer behaviours
The risk of an adverse
impact on profitability if
customers are more
actively seeking a better
rate through ease of
switching and increased
competition.
Enabling current and future members to interact with us through a channel
that suits their needs and delivers good outcomes remains a key focus.
The Group is responding to these risks by investing in digital infrastructure,
enhancing our customer engagement strategies, and developing our product
offerings to meet evolving customer needs and behaviours.
Supporting more of our members to interact digitally and removing more
paper from our journeys supports our ambitions to become paperless.
Group
reputational risk
The risk that a significant
event within a Skipton
Group business
detrimentally impacts the
Group or an individual
Group business, leading to
operational, financial and
reputational impacts.
The Skipton Group brand has continued to develop and become more
prominent throughout 2025. We continue to look for product opportunities for
members, customers and colleagues by harnessing the power of the Group.
We have strengthened our Group operating model and risk management
framework; this will continue through 2026 to ensure the right resources and
capabilities are in place to minimise any associated risks.
Skipton Group Annual Report & Accounts 2025 55
Non-financial Information Statement
The Society, although not required to follow the Companies Act 2006, has sought to voluntarily comply with
elements of s414CB of the Act by including certain non-financial information within our Annual Report &
Accounts to provide our stakeholders with a fuller picture of our performance.
Information regarding the following matters can be found on the following pages:
Non-Financial information Further Detail
Business model Pages 13 and 14
Key performance indicators Pages 16 to 24, and page 35
Key risks Pages 47 to 54
Climate matters Pages 27 to 34
Environmental matters Pages 27 to 34
Colleagues Pages 65
Societal matters Pages 27 to 34
Respect for human rights Pages 25 to 26, page 28 and page 65
Anti-corruption and anti-bribery Page 28
This Strategic Report was approved by the Board of Directors and signed on behalf of the Board by:
Paul Chambers
Group Chief Financial Officer
17 February 2026
P Chambers
Performance & Strategy Governance
Financial Statements
Other Information
58Skipton Group Annual Report & Accounts 2025
“My role is to lead the board’s focus on the
development and delivery of the corporate plan. I
also remain focused on making membership
matter. As members’ behaviour in dealing with
their financial affairs continues to evolve, I’m
working with the team to ensure we serve the
needs of our members today and in the future. This
includes championing change to deliver increased
support for our members – which can be seen in
the initiatives we’ve launched already and those we
plan to introduce. I’m proud to lead a board that’s
tireless in its efforts to support our members and
colleagues and have a positive impact.”
Gwyn brings wide-ranging Executive experience in
retail, thanks to her previous roles at Asda and
Sainsbury’s. She also has significant financial
services experience, having previously held Non-
Executive Director positions with Principality
Building Society, Sainsbury's Bank plc and the
Financial Ombudsman Service. She is currently a
Non-Executive Director at Metro AG.
Appointed to the Board: 2022
• Chair of the Board
• Chair of the Board Nominations Committee
• Chair of the Non-Executive Remuneration
Committee
“I am fully focused on creating a strong franchise
by careful stewardship of the Group. This will
ensure that it matters more to our members and
customers. The Skipton Group is an incredible set
of businesses. It’s well placed to address
challenges such as access to your first home,
financial education and quality impartial advice, as
well as improving access to the housing market
and energy efficiency in UK homes. We’ve made a
start, but there’s so much more we need to do to
support people in these crucial areas. My job is to
make our organisation even more relevant for both
existing and new members as they consider their
long-term financial needs and aspirations.”
Stuart has over 20 years of business leadership
experience across financial services. He brings a
unique blend of technical and customer-facing
skills and experience which will support delivering
value to our members and the modernisation of
the Group. Stuart is driven by the purpose of
serving members' interests now and preparing the
business so we can serve those interests in future.
He has previously held senior Executive roles at
NatWest and HSBC and was CEO of Wealth and
Personal Banking at HSBC UK.
Appointed to the Board: 2022
• Group Chief Executive
• Chair of the Group Executive Committee
• Member of the Non-Executive Remuneration
Committee
Stuart Haire
Executive Director
Gwyn Burr
Non-Executive Director
Performance & Strategy Governance
Financial Statements
Other Information
59Skipton Group Annual Report & Accounts 2025
“My early focus is to learn more about the
business and meet as many colleagues as I can –
especially teams directly serving our members. I
am keen to find ways to understand issues which
our members are most concerned about, then
seek to find solutions to help. I look forward to
becoming a trusted adviser and confidant to our
Chair, as well as being available to support all
board colleagues as they undertake their
important roles delivering value for our members.”
Graham has over 45 years’ executive-level
experience in retail, wealth and commercial
banking, primarily within Lloyds Banking Group.
He was Managing Director of Lloyds’ branch
networks and held Group Director roles in HR,
mortgages and responsible business. Graham
also sat on the boards of the Institute of Financial
Services, the Professional Standards Board and
The Brain Tumour Charity (where he remains as
an emeritus). He is currently a Non-Executive
Director with Vanquis Banking Group plc and One
Family as well as Vice Chair of Break charity.
Appointed to the Board: 2025
• Deputy Chair of the Board and Senior
Independent Director
• Member of the Board Nominations Committee
• Member of the Board Audit Committee
• Member of the Board Change Committee
• Member of the Board Remuneration
Committee
Graham Lindsay
Non-Executive Director
“My priority in 2026 is to continue to balance
providing competitive rates for our members
with the need to keep the Society financially
sustainable. A lower interest rate environment,
combined with inflationary pressures on our
expenses, puts additional pressure on our
financial performance and requires us to
maximise efficiencies across our Group.
Achieving this will allow us to continue to fund
the transformation of our products and
services across our Group.”
Paul brings over 30 years’ financial services
experience, across international banking,
wealth management and management
consulting. He joined the board from Standard
Chartered Group, where he held a number of
senior leadership roles, the most recent being
Group Financial Controller. Paul has an
extensive track record of leading diverse
teams through periods of change, from market
entry to market exit. This includes launching
new products and services, reporting and
control process re-design, and core system
change.
Appointed to the Board: 2024
• Group Chief Financial Officer
• Member of the Group Executive Committee
• Member of the Non-Executive
Remuneration Committee
Paul Chambers
Executive Director
Performance & Strategy Governance
Financial Statements
Other Information
60Skipton Group Annual Report & Accounts 2025
“I was attracted to an organisation that takes a
long-term view and focuses on delivering value to
its members through supporting them with their
mortgages to helping them plan and save for their
future. In what was a year of significant change for
the Society, my main priority was to ensure a
smooth transition for our new Group Chief Financial
Officer. This year, I’ll be focusing on how we
demonstrate that our material controls are
operating effectively to support the requirements of
the updated Corporate Governance Code and our
realisation of the value for members from the
considerable levels of investment and change
within the Society.”
Iain is a Fellow of the Institute of Chartered
Accountants in England and Wales with over 35
years of experience working in the financial sector.
He was a partner at KPMG for over 24 years,
working with banks and other major financial
services firms in both audit and advisory roles,
including three years leading KPMG's banking audit
practice. He is a Non-Executive Director of
Rathbones Group plc (a listed wealth manager),
where he is Chair of the Audit Committee, and a
Non-Executive Director of Tradition London Group,
which comprises the UK subsidiaries of Compagnie
Financiere Tradition SA (an interdealer broker),
where he is Chair of the Audit and Risk
Committees.
Appointed to board: 2022
• Chair of the Board Audit Committee
• Member of the Board Change Committee
• Member of the Board Nominations Committee
• Member of the Board Risk Committee
• Designated Speak Out (Whistleblowing) Non-
Executive Director
“As Chair of the Board Remuneration Committee, I
have continued to ensure that our remuneration
policies and practices are grounded in fairness,
closely aligned with our strategy, and strongly
driven by pay for performance.”
Steven has over 35 years’ experience in retail, fast-
moving consumer goods (FMCG) and financial
services, in the UK and abroad. Over the past 20
years he has held senior Executive roles in HR,
retail operations and change management, always
with a strong focus on the colleague and customer
experience. His last role was with Sainsbury’s
Bank, where he also sat on the Sainsbury’s Group
HR Executive. Steven is a Non-Executive Director of
Peter Vardy, Scottish Ballet and Philip Kingsley. He
brings a wealth of experience in strategy, change
leadership and building strong customer
propositions.
Appointed to board: 2023
• Chair of the Board Remuneration Committee
• Member of the Board Nominations Committee
• Designated Colleague Non-Executive Director
Non-Executive Director
Steven Davis
Non-Executive Director
Iain Cummings
Non-Executive Director
Performance & Strategy Governance
Financial Statements
Other Information
61Skipton Group Annual Report & Accounts 2025
“Skipton’s mission of helping people into homes,
saving for the future, and enjoying long-term
financial security, resonates deeply with my own
values. I firmly believe that financial services have
the potential to create meaningful and positive
changes in people’s lives. As a mutual organisation
owned by its members, Skipton’s focus on giving
back to the community and prioritising its members’
needs is something I am passionate about. We can
make a real difference in people’s lives through
integrity, responsibility, and a commitment to their
long-term well-being.”
Hasintha brings more than 20 years of experience
in financial services, working at Barclays Bank and
HSBC Bank plc in Europe, India and the UK. In that
time, she has led large-scale initiatives aimed at
driving growth, including business, risk, digital, and
culture transformation programs. Hasintha is an
alumna of Harvard Business School and is a
member of the Chartered Institute of Management
Accountants (CIMA) - UK. She is also a Non-
Executive Director of the Countess of Chester
Hospital Trust and coach and mentor, dedicated to
empowering future leaders.
Appointed to board: 2024
• Member of the Board Nominations Committee
• Member of the Board Risk Committee
Hasintha Gunawickrema
Non-Executive Director
“My priority has always been on making sure the
interests of our members are safeguarded.
Whatever happens in the world, it’s important that
we service their needs effectively. I’m a big
advocate of Skipton’s core principle in putting
members first. And it’s been great to see our
member-driven values and purpose grow even
further over the years. As well as the Society, I also
serve on the boards of other financial institutions
in Europe. This keeps me informed on current
issues, so I can contribute to the Society by
weighing up different approaches to common
challenges.”
Denis has worked in senior risk roles with Citibank,
Deutsche Bank and GE Capital. He brings a wide
knowledge of risk management, regulation and
financial services enabling him to Chair the Board
Risk Committee and provide support, advice and
challenge to the Executive team on risk
management issues. Denis is a Non-Executive
Director of Germany's Aareal Bank where he sits on
the Risk Committee and is Chair of the Audit
Committee. He is also a Non-Executive Director for
Moneta Bank in the Czech Republic where he sits
on both the Risk and Audit Committees and Non-
Executive Director and Chair of the Risk and Audit
Committee for Auxmoney Holding in Ireland.
Appointed to board: 2017
• Chair of the Board Risk Committee
• Member of the Board Audit Committee
• Member of the Board Nominations Committee
Denis Hall
Non-Executive Director
Performance & Strategy Governance
Financial Statements
Other Information
62Skipton Group Annual Report & Accounts 2025
“My focus is on fairness and always considering
situations from a member viewpoint. I want to
make sure the change initiatives make the lives of
our members and customers better and easier.
Having being born and always lived in Yorkshire, I’m
focused on value for money! Making sure we have
a positive impact on our members is what drives
me personally. I gain motivation from our purpose
and from our colleagues' desire to serve all
members’ best interests.”
Heather brings her strategy, technology and
operational change background, which is vital as
the Society focuses on improving our customer
service across all channels and on our use of data
to support better decision making. Her experience
is crucial to chairing the Board Change Committee,
ensuring that the Group gains maximum value for
our members from our investment in change. She
has 25 years’ experience in senior Executive roles
at Lloyds plc, Capital One, Boots the Chemist, Asda
and Burton Group plc. She is a Non-Executive
Director for Ikano Bank Europe, Rothesay and The
Veterinary Defence Society, as well as a trustee
Director of Yorkshire Cancer Research.
Appointed to board: 2018
• Chair of the Board Change Committee
• Member of the Board Nominations Committee
• Member of the Board Remuneration Committee
• Member of the Board Risk Committee
Heather Jackson
Non-Executive Director
Board Changes throughout 2025
During 2025 we continued to strengthen our Board
with changes made to its composition, as detailed in
the Chair’s Statement.
Andrew Bottomley, Mark Lund and Philip Moore
stepped down from Skipton Group Board in 2025,
following the AGM on 28 April.
Performance & Strategy Governance
Financial Statements
Other Information
Skipton Group Annual Report & Accounts 2025 64
Business objectives
The business objectives of the Group are set out in
‘Our Group Business Model’ and ‘Focusing on
Ensuring Long-term Success’ sections of the
Strategic Report.
Business review and future developments
The Chair’s Statement, the Group Chief Executive’s
Report and the Strategic Report set out the
performance of the business and its future
objectives.
Profits and capital
Group profit before tax (PBT) was £275.2m (2024:
£318.6m). Total profit after tax (attributable to the
Group) transferred to the general reserve was
£208.6m (2024: £240.5m).
Total Group reserves at 31 December 2025
(excluding non-controlling interests) were £2,861.0m
(2024: £2,667.6m) including the fair value reserve of
£(6.3)m (2024: £(10.6)m), the cash flow hedging
reserve of £9.8m (2024: £16.6m), the cost of
hedging reserve of £(0.4)m (2024: £(1.4)m), and the
translation reserve of £2.8m (2024: £3.2m).
Gross capital at 31 December 2025 was £3,235.8m
(2024: £3,399.2m) including £356.0m (2024:
£690.2m) of subordinated liabilities and £15.2m
(2024: £41.6m) of subscribed capital. The ratio of
gross capital as a percentage of shares, deposits
and borrowings at 31 December 2025 was 8.76%
(2024: 9.70%) and the free capital ratio was 7.24%
(2024: 8.31%). The Annual Business Statement gives
an explanation of these ratios.
Mortgage arrears
Group mortgage balances at 31 December 2025
included 87 cases (2024: 80) either in possession or
where payments were 12 months or more in arrears.
The capital balances of these loans were £16.9m
(2024: £14.1m). The total amount of arrears on
these loans was £1.9m (2024: £1.3m).
Charitable and political donations
In the year, the Group made charitable donations of
£3.1m in relation to our commitment to donating 1%
of pre-tax (2024) Group profits. Our performance this
year means we will donate £2.8m (being 1% of pre-
tax Group profits for 2025), which will be paid in
2026.
No contributions were made for political purposes
(2024: £nil).
Creditor payment policy
The Group’s policy concerning the payment of
suppliers is to negotiate and agree terms and
conditions with all suppliers and upon complete
provision of goods and services, unless there is an
express provision for stage payments, undertake to
pay suppliers within the agreed payment period. The
number of trade payable days as at 31 December
2025 for the Group was 13 days (2024: 11 days).
Performance & Strategy Governance
Financial Statements
Other Information
Dear Member,
The Directors have pleasure in presenting the
Group's Annual Report & Accounts for the year
ended 31 December 2025.
The financial information included in this
Directors’ Report is taken from the statutory
Accounts on pages 131 to 286 prepared in
accordance with UK-adopted International
Accounting Standards in accordance with the
requirements of the Building Societies Act 1986
and with those parts of the Building Societies
(Accounts and Related Provisions) Regulations
1998 that are applicable. Further unaudited
information which allows comparison between
2025 and 2024 is set out in the Strategic Report.
Gwyn Burr,
Chair, Skipton Group
Skipton Group Annual Report & Accounts 2025 65
Principal risks and uncertainties
The principal risks and uncertainties are set out in
the Risk Review and in Notes 43 to 45 to the
Accounts.
Financial risk management objectives and policies
Details of the key risks to which the Group is
exposed in relation to its financial instruments, and
how these risks are managed, are set out in the Risk
Review and in Notes 43 to 45 of the Notes to the
Accounts.
Colleagues
The Group remains committed to its policy of
treating all colleagues and job applicants fairly,
ensuring equal opportunities. Our policy is that no
colleague, or potential colleague, is treated less
favourably on any grounds including age, race,
colour, religion, nationality, ethnic origin, gender,
marital status or sexual orientation. We also give all
applications from disabled people full consideration
in relation to the vacancy concerned and their own
aptitudes and abilities. In the event of an existing
colleague becoming disabled, we make every effort
to maintain their present position or to employ them
in alternative suitable work.
We also aim to provide high quality relevant training
and development opportunities to all colleagues,
which enables them to achieve their full potential
and helps the Group meet its corporate objectives.
The Board is briefed regularly on key colleague
matters as they arise. There is a comprehensive
internal communications structure to cascade
relevant business information to colleagues
throughout the Society in an appropriate and timely
way. The Group’s other businesses have similar
arrangements in place to ensure effective
communication of relevant matters.
The Society recognises an independent trade union
(Aegis) with which management meets regularly to
consult and negotiate on a wide variety of matters
and to which colleagues may make their views
known on issues affecting their interests.
Property, plant and equipment
The Directors consider that the overall market value
of the freehold and leasehold properties occupied by
the Group, excluding the principal office of the
Society, is in excess of their corresponding book
value that is included within property, plant and
equipment (per Note 22 to the Accounts). In arriving
at this view, the Directors have taken account of the
value-in-use, together with internal and external
valuations of the Group’s property portfolio.
It is difficult to ascertain a reliable market value for
the principal office of the Society, which is a special
purpose facility, however the Board considers that its
value in use to the Group is greater than its book
value.
Directors’ responsibilities in respect of the
preparation of the Annual Report, Annual Business
Statement, Directors’ Report and Annual Accounts
This statement, which should be read in conjunction
with the Independent Auditor’s Report, is made by
the Directors to explain their responsibilities in
relation to the preparation of the Annual Report &
Accounts.
The Directors are responsible for preparing the
Annual Report, Annual Business Statement,
Directors’ Report and the Annual Accounts in
accordance with applicable laws and regulations.
The Building Societies Act 1986 requires the
Directors to prepare Group and Society Annual
Accounts for each financial year. Under that law they
are required to prepare the Group Annual Accounts
in accordance with UK-adopted international
accounting standards in conformity with the
requirements of the Building Societies Act 1986 and
have elected to prepare the Society Annual Accounts
on the same basis.
The Group and Society Annual Accounts are required
by law and UK-adopted International Accounting
Standards, in accordance with the requirements of
the Building Societies Act 1986 and with those parts
of the Building Societies (Accounts and Related
Provisions) Regulations 1998 that are applicable, to
present fairly the financial position and the
performance of the Group and the Society. The
Building Societies Act 1986 provides in relation to
such annual accounts that references in the relevant
part of that Act to annual accounts giving a true and
fair view are references to their achieving a fair
presentation.
Under the Financial Conduct Authority’s Disclosure
Guidance and Transparency Rules, group financial
statements are required to be prepared in
accordance with UK-adopted international
accounting standards.
Performance & Strategy Governance
Financial Statements
Other Information
Skipton Group Annual Report & Accounts 2025 66
In preparing each of the Group and Society Annual
Accounts, the Directors are required to:
• Select suitable accounting policies in accordance
with IAS 8 Accounting Polices, Changes in
Accounting Estimates and Errors and apply them
consistently;
• Present information, including accounting
policies, in a manner that provides relevant,
reliable, comparable and understandable
information;
• Make judgements and accounting estimates that
are reasonable and prudent;
• State whether they have been prepared in
accordance with UK-adopted International
Accounting Standards in accordance with the
requirements of the Building Societies Act 1986
and with those parts of the Building Societies
(Accounts and Related Provisions) Regulations
1998 that are applicable, subject to any material
departures disclosed and explained in the
financial statements;
• Assess the Group and Society’s ability to continue
as a going concern, disclosing, as applicable,
matters related to going concern; and
• Use the going concern basis of accounting unless
they either intend to liquidate the Group or the
Society or to cease operations, or have no
realistic alternative but to do so.
In addition to the Annual Accounts, the Act requires
the Directors to prepare, for each financial year, an
Annual Business Statement and a Directors’ Report,
each containing prescribed information relating to
the business of the Group.
The Directors are also required by the Disclosure and
Transparency Rules of the Financial Conduct
Authority to include a management report containing
a fair review of the business, which is set out in the
Strategic Report, and a description of the principal
risks and uncertainties facing the Group which is set
out in the Risk Review.
The Directors have decided to prepare voluntarily a
report on the relevant aspects of corporate
governance as if the Society were required to comply
with the Listing Rules and the Disclosure and
Transparency Rules of the Financial Conduct
Authority in relation to those applicable matters. This
is set out in the Corporate Governance Report.
A copy of these Annual Report & Accounts is placed
on the Society’s website. Information in respect of
the Capital Requirements (Country-by-Country
Reporting) Regulations 2014 is included as an annex
to these Annual Accounts.
Directors’ responsibilities for accounting records
and internal controls
The Directors are responsible for ensuring that the
Group:
• keeps proper accounting records that disclose
with reasonable accuracy at any time the financial
position of the Group and Society, in accordance
with the Act; and
• takes reasonable care to establish, maintain,
document and review such systems and controls
as are appropriate to its business in accordance
with the rules made by the Financial Conduct
Authority and Prudential Regulation Authority
under the Financial Services and Markets Act
2000.
The Directors are responsible for such internal
control as they determine is necessary to enable the
preparation of annual accounts that are free from
material misstatement, whether due to fraud or error,
and have general responsibility for taking such steps
as are reasonably open to them to safeguard the
assets of the Group and to prevent and detect fraud
and other irregularities.
The Directors are responsible for the maintenance
and integrity of the corporate and financial
information included on the Society’s website.
Legislation in the UK governing the preparation and
dissemination of annual accounts may differ from
legislation in other jurisdictions.
Directors’ responsibilities in respect of going
concern
The Group’s business activities together with its
financial position, capital resources and the factors
likely to affect its future development and
performance, including the impact of climate risks
are set out in the Strategic Report and the Risk
Review. In addition, Notes 43 to 45 of the Annual
Accounts include the Group’s objectives, policies and
processes for managing its liquidity risk, details of
financial instruments and hedging activities, and its
exposure to credit risk, liquidity risk and market risk.
In common with many financial institutions, the
Group meets its day-to-day liquidity requirements
through managing both its retail and wholesale
funding sources, and is required to maintain a
sufficient buffer over regulatory capital requirements
in order to continue to be authorised to carry on its
business. The Group’s forecasts and objectives,
which take into account potential changes in trading
performance and funding retention, indicate that the
Group expects to be able to operate at adequate
levels of both liquidity and capital for the next 12-
month period.
Performance & Strategy Governance
Financial Statements
Other Information
Skipton Group Annual Report & Accounts 2025 67
Consequently, after reviewing the Group’s forecasts
and the risks it faces, the Directors are satisfied that
there are no material uncertainties that may cast
significant doubt about the Group’s ability to
continue as a going concern and have, therefore,
continued to adopt the going concern basis in
preparing these Annual Accounts, as explained in
Note 1b) to the Accounts.
Directors’ statement of longer-term viability
In accordance with the UK Corporate Governance
Code, the Directors have assessed the prospects and
the ongoing viability of the Group over a longer
period than the 12-month period required by the
going concern basis of accounting.
The Directors’ assessment of the medium-term
prospects of the Group is based on the Group’s
corporate plans, which project the Group’s
performance, profitability, capital, liquidity and
funding position over a five-year period. The
assessment included a review of the Group’s current
position relative to the market and a review of the
Group’s strategic priorities over the medium-term
including management actions to achieve these
strategic goals.
The assessment also included a robust review of the
Group’s principal risks and uncertainties (outlined in
the Risk Review), which were taken into account to
ensure that the possible likelihood or impact of these
risks materialising would not materially impact the
prospects of the Group and to ensure that the
necessary control framework was in place to
mitigate the impact of these risks on the future
prospects of the business. Specifically, the Directors
took account of those risks that could result in
events or circumstances that might threaten the
Group’s business model, future performance,
solvency or liquidity and reputation, including the
social, economic, political and regulatory
environments and climate change.
The Directors concluded that the medium-term
prospects of the Group are satisfactory and that the
financial strength of the business remains healthy
throughout the period of assessment.
The Directors have assessed the viability of the
Group with the period of assessment being a five-
year period, to the end of 2030. Having considered
various options, the Directors determined that a five-
year period is an appropriate period for the purposes
of the Group’s viability assessment. This period
reflects the Group’s five-year corporate planning
horizon over which the prospects of the Group and
the principal risks threatening these prospects are
assessed as outlined above, and also the period over
which associated stress testing is performed.
In arriving at their conclusion on the longer-term
viability of the Group, the Directors considered the
following:
• The Group’s prospects over the five-year period
as outlined above.
• Stress testing carried out on the 2026 – 2030
business plans through the Group’s Internal
Capital Adequacy Assessment Process and
Internal Liquidity Adequacy Assessment Process.
The key economic stress test modelled reflected
a severe global supply shock which leads to deep
recessions across countries resulting in a sharp
rise in inflation. The Bank of England raise
interest rates to bring inflation back to target. UK
real GDP contracts by 5%, while house prices fall
for 14 straight quarters, with a decline of 28%.
Furthermore, businesses pass on higher costs
through to households with lower-income
households disproportionately affected. A further
scenario was also modelled whereby the key
variables such as unemployment and HPI are
generally aligned to the first scenario, but the
scenario is L-Shaped (GDP) and therefore there is
limited recovery in the outer years, with base rate
remaining low throughout, despite deflationary
fears. The Directors concluded that the impact of
these severe economic environments would not
threaten the longer-term viability of the Group.
• Reverse stress testing carried out by the Group,
which considers scenarios specific to the Group,
including operational issues and external threats,
that could cause the Group to fail. The Directors
have concluded that any such scenarios are
unlikely to materialise.
• The potential impact of climate-related financial
risks across a range of forecast scenarios. This
includes consideration of the potential impact of
two scenarios where there is a disorderly
transition to a low carbon economy by 2050 and
the impact of a scenario in which no such
transition occurs.
• The potential impact of emerging regulation,
where there is sufficient information regarding the
future regulation.
Performance & Strategy Governance
Financial Statements
Other Information
Skipton Group Annual Report & Accounts 2025 68
• The principal risks facing the Group and the
control framework in place to manage and
mitigate these risks (as outlined in the Risk
Review and Board Risk Committee Report),
including an assessment of the likelihood and
impact of these risks on the Group. This includes
specific consideration of the UK’s subdued
growth outlook and the ongoing geopolitical
tensions that continue to exert pressure on
inflation. Despite inflation returning to more
normal levels, and wage growth helping to soften
cost-of-living pressures, there remains significant
strain on some household finances.
• A number of severe but plausible scenarios,
arising from the principal risks, which are remote,
but if they arose could threaten the longer-term
viability of the Group.
There are inherent limitations in preparing long-term
financial plans with regard to a number of factors
including, but not limited to, social, economic,
political, regulatory and climate factors. The
Directors consider that the outer years of the
financial planning period are more difficult to predict
and therefore these years have a greater degree of
uncertainty. For example, the external environment
remains uncertain and although inflationary
pressures are easing and the peak in bank base rate
has been reached, we expect competitive pressures
to remain in the mortgage and savings markets.
These impacts may have an effect on the
performance of the Group within the Group’s
financial planning period; the extent of the impact is
currently unknown.
However, based on the results of this assessment,
the Directors concluded that they have a reasonable
expectation that the Group will be able to continue in
operation and meet its liabilities as they fall due over
the next five years.
Directors
The Directors of the Society at 31 December 2025,
along with their roles and membership of board
committees, are set out in the Board of Directors.
During the year, the composition of the Board was
refreshed to ensure it continues to have an effective
balance of skills, knowledge, experience and
diversity to deliver on Skipton Group’s strategic
priorities. Details of changes to the Executive and
Non-Executive Directors of the Society in the year are
set out in the ‘Board changes’ section of the Chair’s
Statement.
Details of Directors’ service contracts or letters of
appointment are disclosed in the Corporate
Governance Report. No Director of the Society had
any interest in the shares of any Group undertaking
as at 31 December 2025.
In accordance with the UK Corporate Governance
Code, all Executive and Non-Executive Directors offer
themselves for election or re-election by the
members at the 2026 AGM.
Auditor
In accordance with Section 77 of the Building
Societies Act 1986, a resolution for the re-
appointment of Ernst & Young LLP (EY) will be put to
the forthcoming AGM of the Society.
The Directors who held office at the date of approval
of this Directors’ Report confirm that, so far as they
are each aware, there is no relevant audit
information of which the Society’s auditor is
unaware, and each Director has taken all the steps
that they ought to have taken as a Director to make
themselves aware of any relevant audit information
and to establish that the Society’s auditor is aware of
that information.
Signed on behalf of the Board:
G Burr
Gwyn Burr
Chair, Skipton Group
17 February 2026
Responsibility statement of the Directors in respect
of the Annual Report & Accounts
The Directors who held office at the date of
approval of this Directors’ Report confirm that, to
the best of their knowledge:
• The Annual Accounts, prepared in accordance
with UK-adopted International Accounting
Standards in accordance with the requirements
of the Building Societies Act 1986 and with
those parts of the Building Societies (Accounts
and Related Provisions) Regulations 1998 that
are applicable, give a true and fair view of the
assets, liabilities, financial position and profit of
the Group and Society; and
• The Strategic Report includes a fair review of the
development and performance of the business
and the position of the Group and Society,
together with a description of the principal risks
and uncertainties that they face.
We consider the Annual Report & Accounts, taken
as a whole, are fair, balanced and understandable
and provide the information necessary for members
to assess the Group’s and Society’s position and
performance, business model and strategy.
Performance & Strategy Governance
Financial Statements
Other Information
Skipton Group Annual Report & Accounts 2025 70
Dear Member,
On behalf of the Board of Directors, I am pleased
to present the Group’s Corporate Governance
Report, which details how the Group’s governance
framework operated in 2025.
As Chair of the Skipton Group, I recognise that
good governance is essential to ensuring
accountability to our members of the
Society. Effective governance underpins a well-
managed business, and I am dedicated to
upholding the highest standards of best practice.
Gwyn Burr,
Chair, Skipton Group
Our approach is based on the principles and
provisions of the UK Corporate Governance Code
2024 (the Code), published by the Financial
Reporting Council (FRC), which applies to listed
companies. There is a regulatory requirement for
building societies to have regard for the Code and, as
it represents industry best practice, the Society’s
Board of Directors (the Board) is committed to
adhering to it in so far as it applies to building
societies and has readily embraced its provisions.
This report outlines the Society’s governance
arrangements and how we meet the requirements of
the Code, which is applicable to listed entities with
accounting periods commencing on or after 1
January 2025. A copy of the Code is available at
frc.org.uk.
The Code operates on a ‘Comply or Explain’ basis.
The philosophy of the Board is to comply with the
Code and the guidance on it issued by the FRC and
the Building Societies Association. However, as the
Code was not designed for mutual organisations,
there are certain provisions with which the Society
cannot comply. The areas of non-compliance during
the year and the reasons for this were:
• Provision 3, which requires the Chair to discuss
governance matters with major shareholders and
relay their views to the Board as a whole (as a
mutual organisation, owned by its members, with
each voting member having one vote, there are no
major shareholders and therefore this specific
requirement is not relevant to the Society);
• Provision 36, which requires remuneration
schemes to promote long-term shareholdings by
executive directors (not possible for the Society
due to its mutual status); and
• Provision 39, which requires directors’ pension
contribution rates to align with those of the
workforce. (All new appointments comply with
this requirement; however, one historical
arrangement remained in place until the director’s
retirement in April 2025.)
During 2025, other than the points listed above, the
Board believes that the Society complied with all
other aspects of the Code.
In March 2026, Denis Hall, the Chair of the Board
Risk Committee, will have served as a non-executive
director for nine years, the maximum tenure
recommended under Provision 10 of the Code. The
recruitment of Denis’ replacement is underway and it
has been agreed that he will remain on the Board
until later in 2026 to ensure a robust handover to his
successor.
The updated Code, published in January 2024,
includes a revised Provision 29 (effective for
accounting periods beginning on or after 1 January
2026) requiring boards to make a declaration in
relation to the effectiveness of their material internal
controls. During 2025, the Risk and Control Self-
Assessment process was strengthened to embed a
culture of risk ownership and continual improvement,
supported by a strong understanding of our material
control activities. Group-wide risk reporting has also
been enhanced to provide a clear, aggregated view
of current and emerging risks to the Board.
Performance & Strategy Governance
Financial Statements
Other Information
Skipton Group Annual Report & Accounts 2025 71
The Role of the Board
The Board’s terms of reference clearly set out its responsibility for the overall stewardship of the Group within
the context of the Group’s governance arrangements which are described below.
The Board formulates strategy and establishes the Society’s risk appetite and balance sheet strategy. It is
organised to have a proper understanding of, and competence to deal with, the current and emerging issues
facing the business of the Group, exercising independent judgement, and effectively reviewing and challenging
the performance of management.
Other changes in the Code included a requirement
for boards to examine how culture is monitored and
embedded; and to ensure that directors’
remuneration includes malus and clawback
provisions. Culture is covered in the People section
of this report and details of applicable malus and
clawback provisions are set out in the Directors’
Remuneration Report.
Governance Framework
The Group comprises the Society, regulated by the
Financial Conduct Authority (FCA) and the Prudential
Regulation Authority (PRA), and its direct and indirect
holdings in a number of legal entities, some of which,
including Connells, are also regulated by the FCA.
SIL, based in the Channel Islands, is regulated by the
Guernsey Financial Services Commission (GFSC).
The Group’s governance arrangements ensure that it
meets the requirements and expectations of
members, colleagues and regulators. The Board
oversees the Group supported by a number of board
committees. Information on these committees is
included on page 73.
The Group Chief Executive is responsible for
ensuring that the Group meets its strategic and
operational objectives set out in the Corporate Plan.
He is supported by the Group Executive Committee,
which he chairs, and comprises the Group Chief
Financial Officer and senior Group Executives.
Each Group subsidiary is governed by its own board,
responsible for the prudent management of the
subsidiary’s businesses, operating within the Board’s
risk appetite and delegated authorities and for
delivering agreed Corporate Plan objectives.
Regular reviews of corporate governance
arrangements across the Group are conducted to
ensure that key subsidiary boards maintain an
appropriate level of independence and flexibility.
Overall, the Board’s governance arrangements
provide the systems and controls needed to set the
Group’s direction and ensure effective oversight.
Board
responsibility
How this is achieved
Governing
Body
The Society is headed by an effective Board which is responsible for the overall
stewardship and the long-term success of the Group.
The Board reviews and approves the Group’s long-term objectives, commercial strategy
and Corporate Plan, ensuring that the interests of the Society’s members remain central to
all decisions, while considering other key stakeholders. It embeds a culture that prioritises
customer outcomes and maintains oversight of the Group’s material risks. The Board is
structured to understand and address current and emerging issues, exercise independent
judgment, and effectively review and challenge management performance.
Effective
Oversight
The Society’s governance framework enables the Board to provide strategic guidance and
effective oversight across the Group.
The governance framework clearly defines the respective roles and responsibilities of
directors and senior executives, ensuring accountability to the Group and its
members. This ensures a balance of authority such that no single individual has
unfettered powers. Through clear lines of sight into activities, the Board can challenge
effectively, obtain assurance on performance, uphold the integrity of reporting, and
confirm the effectiveness of internal control implementation.
Risk
Management
Oversight
The Board has a sound strategy for oversight of risk management and systems of internal
control supported by timely and transparent reporting.
This approach enables the Board to monitor risks on an ongoing basis and ensures the
Board is informed of material changes to the risk profile of the Group. It facilitates
challenge of the effectiveness of actions taken to mitigate risk. The approach is forward-
looking to reduce both the likelihood and the impact of known risks crystallising.
Performance & Strategy Governance
Financial Statements
Other Information
Skipton Group Annual Report & Accounts 2025 72
The Board has established a clear framework of
delegated authorities setting out matters reserved
for the Board and those delegated below board level.
The Board also has a general duty to ensure that the
Group operates within the Society’s Rules, relevant
laws, regulations and guidance issued by relevant
regulatory authorities and that proper accounting
records and effective systems of internal control are
maintained and audited.
Culture
The Board has agreed purpose, behaviours and
culture statements for the Society to guide the
business and set expectations for colleagues. Our
purpose remains constant: helping more people have
a home, helping people save for life ahead and
supporting long-term financial well-being. To help
deliver this it is important that our culture puts
members and customers at the centre of our
thinking and values diversity amongst our workforce
and the communities we serve.
The Board monitors culture and how culture is
embedded in a number of ways including through the
appointment of a designated Non-Executive lead for
colleague listening and engagement, customer
feedback, employee surveys and independent
assurance reviews. The Group Chief People Officer
formally reports to the Board on cultural evolution on
a quarterly basis.
Board meetings
The Board met eleven times during 2025. In line with
good governance and to support independent
discussion, the non-executive directors met privately
after most Board meetings. The attendance record
of each director at Board and Board committee
meetings is set out on page 76.
In addition, the Board held two strategy meetings in
the year, in June and December, where the Group’s
strategic objectives (which the Board formally
approved in December 2024 and re-approved in
December 2025) were reviewed and discussed.
A forward-looking meeting planner, maintained by
the Group Secretary and General Counsel, ensures
effective use of Board time whilst allowing flexibility
for emerging matters.
Each Board meeting receives:
• Reports from the Chair, Group Chief Executive and
the Group Chief Financial Officer;
• A detailed management report on the Society and
the Group, containing financial and non-financial
data; and
• Updates on all Board committee meetings held
since the previous meeting of the Board.
For the Board to be effective, the relationship
between the executive directors and non-executive
directors must be constructive, open and respectful.
The boardroom environment is collegiate, and all
directors are encouraged to contribute. The role of
the non-executive directors is not only to challenge
but to support the Group Executive Committee and
bring their experience to bear. To this end, the non-
executive directors are welcomed to meetings
outside the formal Board and committee structure,
which develops their understanding of the business
and allows the management teams to benefit from
their experience and fully understand the Non-
Executive perspective on particular issues.
Performance & Strategy Governance
Financial Statements
Other Information
Responsibility Key activity
Strategy
• Approved the ongoing Corporate Plan and monitored delivery of the strategic actions
identified to achieve the Group’s strategy.
• Reviewed progress on the delivery of each of the Society’s key strategic change
projects, particularly focusing on the development of the Society’s digital capabilities.
• Approved additional investment for the continued upgrade of Connells’ IT infrastructure.
Risk
Management
and Regulatory
Matters
• Approved the Society’s risk appetite and monitored ongoing adherence.
• Approved the Board Risk Appetite Statement, the Internal Liquidity Adequacy
Assessment Process (ILAAP) and the Internal Capital Adequacy Assessment Process
(ICAAP).
• Approved the Society’s Recovery Plan and Resolvability Assessment Framework (RAF)
to ensure that adequate provisions and processes are in place to protect the Society’s
business and its members.
• Approved the Consumer Duty Board Assessment.
Below are some of the material matters considered by the Board during the year:
Skipton Group Annual Report & Accounts 2025 73
Responsibility Key Activity
Performance
and Financial
Reporting
• Reviewed and approved the Society’s interim and full year financial results.
• Considered and approved the redemption of the Society’s Permanent Interest-Bearing
Shares (PIBS).
• Reviewed and approved the Society’s Annual Report & Accounts and Summary
Financial Statements.
• Approved the Long-term Viability Statement.
• Approved the Letter of Representation to the Auditors.
• Approved amendments to the Group Tax Strategy.
People and
Culture
• Reviewed and implemented changes to Board Committee membership.
• Appointed Graham Lindsay as Senior Independent Director and Deputy Chair from 19
May 2025.
• Reviewed the 2026-2030 Colleague Plan.
• Considered the outcomes of colleague pulse surveys.
• Considered the annual report on Gender Pay Gap within the Society.
• Approved the Board Composition Policy.
Environmental,
Social and
Governance
(ESG)
• Completed the annual review and approved the terms of reference of the Board & each
of its committees.
• Reviewed and approved the Society’s Speak Out (Whistleblowing) Policy and received
the Whistleblowing Annual Report.
• Approved the Group Sustainability Report.
•
Approved the Society’s costed emission reduction plan and approved the Group’s 2030
Scope 1 target & Scope 2 aim.
Performance & Strategy Governance
Financial Statements
Other Information
Board Structure at 31 December 2025
The Board has delegated certain matters to its committees in order that these can be considered in more
detail. The terms of reference of all Board committees are available at skipton.co.uk/about-us/governance
or from the Group Secretary and General Counsel.
Group Chair: Gwyn Burr
Responsible for leading the Board, setting the Board’s agenda and ensuring the Board’s effectiveness.
Board
Responsible for the overall stewardship and the long-term strategy of the Society and the Group
9 Directors
Non-Executive Directors: Gwyn Burr, Iain Cummings, Steven Davis, Hasintha Gunawickrema, Graham Lindsay,
Denis Hall, Heather Jackson
Executive Directors: Stuart Haire, Paul Chambers
Board Audit
Committee
Board Change
Committee
Board
Nominations
Committee
Board
Remuneration
Committee
Board Risk
Committee
Non-
Executive
Remuneration
Committee
Chair:
Iain Cummings
Members:
Denis Hall
Graham Lindsay
Chair:
Heather Jackson
Members:
Iain Cummings
Graham Lindsay
Chair:
Gwyn Burr
Members:
Iain Cummings
Steven Davis
Hasintha
Gunawickrema
Denis Hall
Heather Jackson
Graham Lindsay
Chair:
Steven Davis
Members:
Heather Jackson
Graham Lindsay
Chair:
Denis Hall
Members:
Iain Cummings
Hasintha
Gunawickrema
Heather
Jackson
Chair:
Gwyn Burr
Members:
Stuart Haire
Paul Chambers
Skipton Group Annual Report & Accounts 2025 74
Responsibilities
Senior
Independent
Director & Deputy Chair
Graham Lindsay
• In conjunction with the Chair, providing support and challenge to the Group
Chief Executive and other members of the senior management team, and
building a working relationship with them, that enables this to happen
effectively.
• Upholding high standards of integrity and probity and supporting the Chair
and executive directors in instilling the appropriate culture, values and
behaviours in the boardroom and beyond.
• Working closely with the Chair, deputising for the Chair in their absence
and acting as a sounding board, sharing with the Chair other representative
duties and providing support as and when required.
• Acting as an intermediary for other directors as and when necessary.
• Being available to meet with any directors or other key stakeholders,
including regulators, to understand their concerns and, in the event that
contact with the Chair and/or Group Chief Executive is inappropriate or has
failed, to present their views to the Board as a whole.
• Leading the annual performance evaluation of the Chair, meeting with the
non-executive directors (without the Chair or executive directors present)
for this purpose, ensuring that views of the executive directors are also
taken into account.
Responsibilities
Chair of the Board
Gwyn Burr
• Managing and providing leadership to the Board and Group, safeguarding
and promoting the long-term success and sustainability of the Society in
the interests of current and future members.
• Leading the Board’s contribution to supporting the Group CEO and
Executive team in the development of the Group’s strategy.
• Establishing agendas for Board meetings, ensuring they are appropriately
focused on strategy, performance, culture and risk management matters,
and proactively managing the annual calendar of business to ensure the
most appropriate use of the Board’s time.
• Fostering a culture where Board members can challenge issues openly and
encouraging and managing strong debate whilst achieving decisions on
issues considered by the Board.
• Demonstrating ethical leadership and upholding the highest standards of
integrity and probity, setting clear expectations concerning the Society’s
and Group’s culture and behaviour.
•
Building an effective and diverse Board reflecting an appropriate balance of
skills and experience given the Group’s current and future activities.
• Leading the development of, and monitoring the effective implementation
of, the approach to the training and professional development of all the
non-executive directors.
• Ensuring effective communication with all stakeholder groups and
communicating with the Society’s members on behalf of the Board.
• Supporting the Group Chief Executive and leading the annual appraisal of
the Group Chief Executive.
Division of responsibilities
The roles of the Board Chair and the Group Chief Executive are distinct and held by different individuals. The
responsibilities of each role holder is set out in their role profiles and terms of appointment.
The Senior Independent Director and Deputy Chair plays a key role in supporting the Chair in leading the
Board and acting as a sounding board and source of advice for the Chair and the Board. Graham Lindsay
was appointed as Senior Independent Director and Deputy Chair effective 19 May 2025, following Mark
Lund stepping down from the Board at the 2025 AGM.
Performance & Strategy Governance
Financial Statements
Other Information
Skipton Group Annual Report & Accounts 2025 75
Responsibilities
Group Chief Executive
Stuart Haire
• Delivering the strategy for the Group as agreed by the Board.
• Ensuring the prudent day-to-day management of all Group businesses.
• Providing leadership and direction to, and developing the vision and
strategy of, the Group.
• Communicating the purpose, vision, strategy and performance of the
Skipton Group to members, colleagues, regulators and other stakeholders.
• Building and leading an effective Group Executive team to manage Group
businesses in the longer-term interests of the Society’s members.
• Ensuring that effective succession and development plans are in place and
implemented for all key Executive roles.
• Leading the Group Executive Committee to successfully deliver agreed
plans, objectives and targets within the Board agreed appetite for risk.
• Monitoring the effective implementation of policies and procedures for the
induction, training and on-going development of all individuals performing
designated senior management functions on behalf of the Group.
Performance & Strategy Governance
Financial Statements
Other Information
Conflicts of interest
The Society’s directors are required to comply with
the Board Conflicts of Interest Policy. The policy
gives effect to various legal and regulatory
requirements on the Society in relation to conflicts of
interest and aims to ensure that directors do not
assume roles which would conflict with their
obligations as a director of the Society. Prior to
appointment, prospective directors must disclose
any actual or potential conflicts of interest that may
prevent them from taking on an appointment with
the Society.
In addition, directors must seek approval from the
Chair and the Group Secretary and General Counsel
before committing to any additional external
appointment. Where such approval is sought, the
director must confirm the existence of any potential
or actual conflicts, that the role does not exceed the
regulatory limits on directorships and provide
assurance that the appointment will not adversely
impact their ability to continue to fulfil their role as a
director of the Society.
In accordance with their duties as directors, each
director is also obliged to notify the Board of any
actual or potential interest that they have in any
matter to be considered at a meeting. If any potential
conflict does arise, the Board Conflicts of Interest
Policy permits the Board to authorise it, subject to
any conditions or limitations as it may deem
appropriate. Such instances are recorded in the
minutes of the relevant meeting.
Induction and professional development
On appointment, new directors receive a
comprehensive and tailored induction covering the
Group’s businesses and regulatory environment.
Directors from non-banking backgrounds receive
specific training on the capital and liquidity regimes
governing the Society’s operations. In line with the
Code, directors have access to the necessary
resources to maintain and update their knowledge
and capabilities. In addition, each director undergoes
an annual "fit and proper" assessment in compliance
with regulatory requirements, which includes
competence and capability. Training and
development needs are reviewed regularly and
addressed through external seminars and interactive
Board training sessions led by internal and external
specialists. During 2025 training has been delivered
on employment law, climate risk, model risk
management and the resolvability assessment
framework. Non-executive directors are encouraged
to attend one group subsidiary board meeting per
year, and to engage with members of the Group
Executive Committee to demonstrate support and to
undertake visits to subsidiaries, branches and
departments.
Directors have access to the Group Secretary and
General Counsel for advice on all corporate
governance matters and to ensure that Board
procedures are followed. The appointment and
removal of the Group Secretary and General Counsel
is a matter reserved to the Board.
Directors also have access to independent
professional advice, if required, at the Society’s
expense and benefit from appropriate liability
insurance cover.
Skipton Group Annual Report & Accounts 2025 76
Performance & Strategy Governance
Financial Statements
Other Information
Time commitment
One of the criteria which the Board takes into consideration when recruiting a non-executive director is their
ability to commit sufficient time to take on the position. In addition, throughout their term of office directors
are required to inform the Chair in advance of any other positions that they wish to take up so that the time
commitment and any potential conflict of interest can be considered.
*Monthly commitment relates to months in which there is a committee meeting. It is in addition to the annual commitment for Non-
executive Directors.
Independence
No non-executive directors have any direct business relations with the Society or any of its subsidiaries or
have any personal or family ties with any of the organisation’s advisers, other directors, or senior employees.
The Board considers all the non-executive directors to have been independent at the time of their
appointment and to have continued to be so in accordance with the criteria set out in the Code. As Chair, I
can confirm that I am independent and have no conflicting relationships or circumstances that might affect
my judgement on Group or Society matters.
Role
Expected annual time commitment
Chair
80 to 100 days
Senior Independent Director & Deputy Chair
As required to fulfil the role
- minimum of 30 to 36 days
Non
-executive Directors
30 to 36 days
Committee Chairs
Expected monthly commitment*
Board Audit Committee
2 to 2.5 days
Board Change Committee
1.5 to 2 days
Board Remuneration Committee
2 days
Board Risk Committee
3 to 3.5 days
Board and Committee membership attendance record
The attendance of directors at scheduled Board and committee meetings during the year is set out below:
Scheduled
Board
Board
Audit
Committee
Board
Change
Committee
Board
Nominations
Committee
Board
Remuneration
Committee
Board
Risk
Committee
NED
Remuneration
Committee
Gwyn Burr
11 of 11 4 of 4 5 of 5
Paul Chambers
11 of 11 5 of 5
Iain Cummings
11 of 11 5 of 5 4 of 4 4 of 4 6 of 6
Steven Davis
11 of 11 4 of 4 8 of 8
Hasintha
Gunawickrema
10 of 11 2 of 4 4 of 4
Stuart Haire
11 of 11 5 of 5
Denis Hall
10 of 11 5 of 5 3 of 4 6 of 6
Heather Jackson
11 of 11 4 of 4 4 of 4 8 of 8 6 of 6
Graham
Lindsay
2
5 of 6 3 of 3 3 of 3 3 of 3
Andrew Bottomley
3
3 of 3 1 of 1
Mark Lund
4
3 of 3 2 of 2 4 of 4
Philip Moore
5
3 of 3 2 of 2 2 of 2
Notes
1. Where directors are not available to attend meetings, they still receive all papers and provide feedback as appropriate.
2. Graham Lindsay was appointed to the Board on 19 May 2025.
3. Andrew Bottomley resigned from the Board on 28 April 2025 .
4. Mark Lund resigned from the Board on 28 April 2025.
5. Philip Moore resigned from the Board on 28 April 2025.
Skipton Group Annual Report & Accounts 2025 77
Performance & Strategy Governance
Financial Statements
Other Information
Composition, succession and evaluation
Board Composition
Under the Society’s Rules, the Board must comprise no more than 15 and no less than six directors and, under
the Code, at least half of the Board should comprise non-executive directors. At 31 December 2025, the Board
comprised the Chair, six other independent non-executive directors and two executive directors. This
composition is designed to be able to meet the needs of the Group and allow for appropriate and efficient
operation of the Board’s committees. Details of the Society’s directors are set out in the Board of Directors
section.
Non-executive directors Mark Lund and Philip Moore, and executive director Andrew Bottomley stepped down
from the board at the 2025 AGM. Graham Lindsay was appointed as Senior Independent Director and Deputy
Chair from 19 May 2025. An independent recruitment search firm, Russell Reynolds, which has no connection to
the Society or any individual directors, assisted in the recruitment of Graham Lindsay.
The diagrams below set out the current composition of the Board in respect of tenure, age, gender and the
number of executive and non-executive directors.
At 31 December 2025, three members (33%) of the Board were female. The Society is a signatory to the Women
in Finance Charter, which underlines the Board’s commitment to gender equality. Harnessing the benefits of
diversity is a key consideration in all new recruitment to the Board.
As Chair, I will continue to review the size and composition of the Board and its committees regularly, in
conjunction with the Board Nominations Committee, to ensure that they are optimally resourced and refreshed
at appropriate intervals. Our Board Composition Policy is available on the Society’s website.
Appointments to the Board and its committees and at Executive level
The Board Nominations Committee (NomCo), comprising all the Society’s non-executive directors and chaired
by me, leads the process for Board and Group Executive Committee appointments and succession planning and
is also responsible for non-executive and executive director appointments across the key group companies.
Appointments to the Board, its committees and to the Group Executive Committee are made by the Board on
the recommendation of NomCo, in consultation with relevant committees’ chairs and, where appropriate, group
company boards. All appointments are based on merit. The Board considers all aspects of diversity when
reviewing the composition of the Board, its committees and the Group Executive Committee. Copies of the letter
of appointment for each of the non-executive directors are available for inspection on request from the Group
Secretary and General Counsel.
Succession planning remains a key priority. NomCo conducts an annual review of the Board’s structure, size,
and composition to ensure the right balance of skills, knowledge, and experience aligned to the Group’s
activities. This review considers both short- and long-term requirements for delivering the Group’s strategy,
taking account of strategic priorities and evolving customer behaviours.
Tenure of Non-Exec DirectorsAge of all Directors
All Directors (9)
1
2
6
40-49 50-59 60+
1
2 2 2
<1 year 1 to 3 3 to 6 >6
Non-Executive Directors Only (7)
All Directors (9) All Directors (9)
Gender of all Directors
Type of Director
7
2
Non-Exec Exec
6
3
Male Female
Skipton Group Annual Report & Accounts 2025 78
Performance & Strategy Governance
Financial Statements
Other Information
In Q2 2025, NomCo undertook an internal Board
effectiveness evaluation review and completed a
Board Skills matrix. Board composition was also
reviewed at the Q4 2025 NomCo meeting.
Succession planning covers both planned and
unforeseen events. NomCo reviewed arrangements
for senior Executives and their direct reports,
incorporating diversity considerations. Plans ensure
that individuals with potential receive appropriate
development opportunities and that robust
contingency measures are in place. Succession
planning for the Board was also considered.
Tenure, election and re-election of directors
The Society’s Rules require that all directors stand
for re-election annually. Non-executive directors are
generally appointed for an initial period of three
years and, whilst expected to serve for six years, this
may be extended to nine years in total.
All Society directors are subject to election following
their appointment and annual re-election by our
members at the AGM. Details of each individual
director’s role and experience are provided in the
booklet accompanying the Notice of AGM sent to all
qualifying members each year.
As mentioned earlier, the Board is currently recruiting
a new Board Risk Committee chair as the current
chair, Denis Hall, will reach the maximum tenure
recommended by the Code in March 2026. We
anticipate that the new Board Risk Committee chair
will be appointed during the summer of 2026 and will
stand for election at the 2026 AGM.
Board evaluation
The Board undertakes an annual evaluation of its
own performance and that of its committees. An
external review is undertaken at least every three
years. The outcome of the most recent external
review, undertaken by Claire Chalmers Ltd in 2023,
was considered by the Board in February 2024. The
recommendations informed a board effectiveness
action plan.
The directors participated in an internal board
performance review of 2024 using anonymised
questionnaires and which was discussed at the
NomCo meeting in Q2 2025. All directors engaged
fully in the process.
The review confirmed that the Board and its
committees continue to operate effectively, with high
levels of engagement and expertise. Key areas for
further development, such as enhancing workforce
engagement and maintaining focus on board
composition and subsidiary oversight, were
incorporated into the action plan. Progress has been
monitored in 2025 and will continue to be overseen
by the Board.
Individual review
Individual non-executive directors are evaluated
annually on a one-to-one basis by the Chair.
Executive directors are evaluated by the Group Chief
Executive against agreed performance targets for
their areas of responsibility and their own personal
performance. The Chair evaluates the Group Chief
Executive’s performance whilst the Deputy Chair and
Senior Independent Director leads the Board
evaluation of the Chair’s performance. All reviews
are documented and conducted at least annually.
Remuneration
Details relating to directors’ remuneration are
contained in the Directors' Remuneration Report.
Directors’ service contracts and notice periods
The executive directors are engaged on rolling
service contracts which can be terminated by either
the Society or the director giving one year’s notice.
Unless notice to terminate is given by either party,
the contracts continue automatically.
All non-executive directors are provided with a letter
of appointment on joining the Board and do not have
service contracts. The Chair has a 6-month notice
period and all other non-executive directors have a
notice period of 3-months.
Audit, risk and internal control
Financial reporting
After appropriate enquiries, review of internal
management reports and completion of the external
audit, the directors consider that these Annual
Report and Accounts, taken as a whole, are fair,
balanced and understandable, and provide the
information necessary for members to assess the
Group’s performance, business model and strategy.
Further details on how this conclusion has been
arrived at can be found in the Board Audit Committee
Report.
The directors’ responsibilities in relation to the
preparation of the Group’s Annual Accounts and a
statement confirming that the Group is a going
concern are contained in the statements of Directors’
Responsibilities in the Directors’ Report.
Risk management and internal control
The Board is responsible for overseeing the Group’s
strategy for managing risk and systems of internal
control, which includes reviewing and approving its
risk appetite on, at least, an annual basis. The
executive directors and senior management are
responsible for the continuous operation of an
effective Group risk management framework based
on a robust system of internal control.
Skipton Group Annual Report & Accounts 2025 79
Such systems are designed to manage rather than
eliminate the risk of failure to achieve the Group’s
business objectives.
The principal categories of risk confronting the
Group are described in greater detail in the Risk
Review, together with an explanation of the Three
Lines of Defence framework adopted by the Group
for managing risk.
The Board reviews the ongoing effectiveness of its
internal control systems through a combination of
processes including:
• Regular reports to the Board by the chairs of its
various committees;
• Presentations to the Board by functional leaders
relating to the strategy and performance of each
business, summarising business performance,
key business risks, issues and strategies;
• Regular reports to the Board, through the Board
Audit Committee, from the Group Internal Audit
function in respect of its independent audits of
risk management processes and effectiveness of
internal controls across the Group. The Group
Chief Internal Auditor reports to the Chair of the
Board Audit Committee and attends Board Audit
Committee and Board Risk Committee meetings;
and,
• Regular reports to the Board, through the Board
Risk Committee, from the Group Risk function on
the principal conduct, operational, credit, market
and liquidity risks facing the Group and the
strength of the controls in place to mitigate these.
The Group has a comprehensive system for
reporting financial results to the Board. Each
business prepares monthly management information
with comparisons against budget which the Board
reviews and challenges, as appropriate, where
performance is not in line with expectations.
The Group has a number of central oversight and
control functions, including Finance, Risk and
Compliance, which establish and monitor the
implementation of compliance and operational
standards. Each of these functions is subject to
periodic review by the Group Internal Audit function.
The Group Internal Audit function is responsible for
independently reviewing and reporting on the
adequacy and effectiveness of internal controls
operated by management throughout the Group,
thereby helping to evaluate and improve the
effectiveness of risk management. Through its
programme of work, approved by the Board Audit
Committee, the Group Internal Audit function is able
to provide assurance on control effectiveness.
To ensure sufficient focus is devoted to risk
oversight, the Group Chief Risk Officer role is a
senior Executive position and member of the Group
Executive Committee. The Board Risk Committee
and the Board receive regular reports from the Group
Chief Risk Officer throughout the year and he attends
all meetings of the Board Audit Committee and the
Board. The Board is satisfied that it understands the
risks confronting the Group and that senior
management are taking appropriate action to
mitigate these. More detail is provided on these in
the Risk Review.
To further strengthen the standard of Group
governance, the Group Risk Management Framework
(GRMF) was implemented in 2025. The GRMF
defines clear risk management roles and
responsibilities, governance structures and risk
reporting expectations across all Group businesses.
The Board is satisfied that the Group maintained an
adequate system of internal control during 2025,
with a clear focus on risk management. This was
carried out in a manner that met the requirements of
the Code and good business practice generally.
In anticipation of the revised Provision 29 of the
Code which comes into effect in January 2026, the
Group has undertaken a programme of work in 2025
to further enhance and strengthen existing
approaches. Further details are included within the
Board Risk Committee Report.
Stakeholder engagement
The Board recognises the importance of engaging
with its stakeholders and understanding their views
and concerns. It has identified its key stakeholders
as our members and customers; our colleagues; our
suppliers; our banking counterparties; and our
regulators.
Members and customers
The Society’s membership comprises its savers,
borrowers, holders of its Permanent Interest-Bearing
Shares (PIBS) and non-corporate borrowers. A
‘member’ is different from a shareholder of a listed
company, whose owners may include institutional
shareholders.
The vast majority of the Society’s customers are,
therefore, its members. Against a backdrop of
significant economic and political uncertainty, it is of
the utmost importance that we understand our
members and listen closely to their views. In
recognition of this, the Society actively seeks
feedback from members on all aspects of its
activities and strives to respond quickly to points
requiring action.
Performance & Strategy Governance
Financial Statements
Other Information
Skipton Group Annual Report & Accounts 2025 80
All our research is conducted by skilled Market
Research Society registered practitioners, employed
both in-house and through carefully selected
partners (including award-winning research
agencies).
Further, to help fulfil our aim of allowing meaningful
participation, our Member Panel remained strong
with over 21,000 panellists.
Over the last year, Panel feedback has helped us
better understand topics such as longer-term
mortgage products, life insurance, online security
and intergenerational wealth.
We were able to make various improvements in 2025
that have benefitted our members.
Making Money Work Harder
• We expanded our member exclusive savings
range further, giving members access to
exclusive savings rates. Throughout 2025 we saw
over 90k accounts opened.
• Alongside our member exclusive range, we
continued to offer competitive savings rates
across the entire range and as at 31 December
2025 we paid 0.68% above market average on all
our savings rates.
• We continued our support for members, through a
My Money Review or Enquiry where our skilled
colleagues provide access to free advice to
members so that they can better understand the
savings and investment choices available to them
and make clear, informed decisions; helping their
money work harder.
• We created a free Stocks & Shares ISA advice
product exclusively for members.
• We are one of a small number of providers that
give our members more choice in how they split
their current year ISA subscription allowance
across multiple Cash ISA accounts.
• We continue to be the largest high street provider
of the Lifetime ISA, a product designed to give a
boost to first-time buyers saving for a deposit.
We’ve enabled bonus payments from the
Government of over £45m in 2025.
Helping People Have a Home
• We are here to help more people than ever have a
home and have continued to innovate to make
this a reality.
• We continue to offer our Track Record product
range and make it available to more first-time
buyers. We also offer mortgages on properties
bought through Government Schemes including
Shared Ownership and LIFT, as people continue
to need a variety of solutions to take their first
step onto the ladder.
• We recognised first-time buyers getting the keys
to their first home by gifting over 20,000 Home
Mover Boxes, containing a range of useful
household items.
• Helping homeowners and landlords to reduce
their carbon footprint remains a priority for us and
we understand that the first step is access to
expert guidance. That’s why we continue to offer
free EPC+ reports to all our members.
• This year has also seen us complete a full retrofit
on a Society owned property in Skipton with a
view to supporting our customers in
understanding the practicalities of installing
carbon-reducing measures in their own homes.
We also continue to use our findings to influence
policy makers.
Making Membership Matter
• Our colleagues sent gifts to more than 2,000
members to mark special occasions or times of
need.
• We actively invited members to participate in
shaping our business, and in 2025 60,647
members exercised their voting rights in the AGM,
which also gave members the opportunity to
select Refuge as our charity partner.
• We developed new products and functionality to
suit our customer needs and enhanced
communications to members ahead of product
maturities.
The Society has continued to achieve extremely high
levels of net member satisfaction across Homes and
Money, scoring 90% in 2025.
As a mutual organisation it’s important for us to be
transparent in sharing our member feedback. This
has been demonstrated by our continued pursuit to
gain public reviews from members via our
partnership with Trustpilot. Since integrating this
with our existing ongoing research programme
towards the end of 2020, we have maintained a
strong rating. This was 4.2 stars out of 5 as at 31
December 2025.
Performance & Strategy Governance
Financial Statements
Other Information
Skipton Group Annual Report & Accounts 2025 81
Our colleagues
It is important to us that we have a thorough
understanding of our colleague’s views regarding
their experience of working at the Society and we do
this in a number of ways – through team meetings,
regular pulse surveys, employer review websites,
listening sessions and independent assessments.
In 2025 we formally introduced “employee Net
Promoter Score” as a robust method to assess
colleague engagement levels; including reviewing
over 50,000 comments as part of written feedback
submitted in our pulse surveys.
We have built on our work in 2024 and continued to
evolve our approach to colleague listening and
involvement during 2025, focusing more on
developing our culture and ways of working. The
Behaviours Framework continues to be incorporated
into our strategic communications, leadership
definition, performance management and approach
to colleague recognition (playing a central part in our
annual colleague recognition awards).
Part of our evolving approach to colleague listening
and participation is the desire to influence the large
and small details that form part of the everyday
colleague experience. In terms of the large details,
we have a programme to transform our technology,
customer and colleague journeys where we are
directly engaging with colleagues on how we build
our systems and processes. As part of our
Transformation Programme, we actively involve
colleagues in testing the customer engagement
platform, asking them to be critical and find what
worked and what we can improve on.
In terms of the smaller but important details,
additional emphasis has been placed on leaders
listening to their teams for feedback and to act upon
this locally, empowering both leaders and
colleagues. We will continue to use colleague
feedback to inform our work, further enhancing the
way we engage with our colleague base.
In line with the Code’s requirements, the Board
appointed non-executive director, Steven Davis, to be
the director responsible for providing a further
avenue for the voice of our people to be heard at the
Board table. This role also helps to identify cultural
trends, risks and opportunities; strengthen trust and
transparency and drive better decision making. In
2025, he held focus groups with customer-facing
colleagues to understand their views, took part in call
listening sessions and met with senior leaders.
Together with regular personal communications
from members of the Group Executive Committee in
the form of videos, we have also continued to hold
quarterly Strategic Updates where colleagues can
ask questions of the Group Chief Executive and the
Group Executive Committee regarding our direction
of travel.
Suppliers
The Group closely monitors all its business
relationships with suppliers, on an ongoing basis,
assessing any risk of an adverse impact on our
members, customers, our people and the
environment in which we operate as a result of these
relationships, or as a result of our policies.
In 2025, we implemented an enhanced supplier
governance and assurance framework to strengthen
the oversight and relationships we have with our
suppliers. As part of this framework we issue an
annual, online, anonymous questionnaire for
completion by suppliers to assess our performance
as a customer. The topics covered included how
timely and accurate we are when paying invoices, if
our corporate responsibility values are clear and
views on whether we live these, strength of
relationships and comparison of our approach to
other clients. Previous feedback has been very
positive, and the latest survey was issued to
suppliers in Q4 2025.
As part of our focus on sustainability, the Group is
clear regarding the selection of new firms aligning to
our expectations and sustainability goals. We
continue to support our existing supply chain to
achieve better ESG outcomes using data from our
ESG assessment platform.
Regulators
Fostering a positive relationship with our regulators
is a key priority for the Board and senior
management team, supported by continuous
dialogue as appropriate. This involves not only the
provision of prescribed reports but updates from the
senior management team on matters we believe
should be drawn to our regulators’ attention. The
Board sees it as important that regulatory bodies are
kept up to date with strategic and operational
developments within the Group and that they
maintain ongoing confidence in the Board and
management team.
Banking counterparties
Senior Executives and our Treasury team hold
meetings with banks and debt investors, where
appropriate, to update them on the Group’s
performance and respond to any questions. This is a
long-established arrangement which continues to
work well.
Performance & Strategy Governance
Financial Statements
Other Information
Skipton Group Annual Report & Accounts 2025 82
Whistleblowing (Speak Out)
The Society has arrangements in place to ensure
that colleagues can speak up and raise concerns
they might have confidentially and anonymously, if
they prefer. Concerns can be reported via Safecall,
an independent third-party service engaged by the
Society. All concerns raised are investigated and
addressed appropriately. The Society is committed
to ensuring that no individual suffers any detrimental
treatment for speaking up.
Training on the Speak Out (whistleblowing) process
is provided annually to all colleagues and on
induction for new joiners. Each major business
within the Group maintains its own whistleblowing
policy. The Board’s commitment to whistleblowing is
reinforced by the appointment of a non-executive
director as Speak Out Champion. This role is held by
Iain Cummings, who chairs the Board Audit
Committee.
The Speak Out Champion oversees the integrity,
independence and effectiveness of whistleblowing
policies and procedures across the Society and the
Group, including arrangements for protecting
whistleblowers against detriment. An annual report
on the effectiveness of whistleblowing systems and
controls is presented to the Board.
The Annual General Meeting (AGM)
Each year the Society gives all eligible members at
least 21 clear days’ notice of its AGM. At the
meeting, the Chair, the Group Chief Executive and
other members of the Board report back to members
on the previous year’s performance and the main
developments across the Group. Members have the
opportunity to raise questions and put forward their
views. All directors normally attend the AGM, unless
their absence cannot be avoided, and are available
for questions both during a ‘question and answer’
session in the meeting and on an individual basis
before and after the meeting.
All eligible members are encouraged to vote at the
AGM (either personally or by appointing a
representative), although the voting form includes a
‘vote withheld’ option. Members can vote either at
the AGM, by post or online. All votes are returned to
independent scrutineers. A poll is called in relation to
each resolution at the AGM and the results of the
vote are published on the Society’s website and in
branches. As a minimum, the Society’s members at
the AGM are asked to vote on the Society’s Annual
Report and Accounts, election or re-election of all
Directors, appointment or re-appointment of the
external auditor and to receive the Directors’
Remuneration Report. At the 2025 AGM members
were also asked to vote on the advisory resolution to
approve the Directors’ Remuneration Policy.
I am pleased to report that no resolution received
less than 92% support from members at the 2025
AGM.
Board priorities in 2026
Together with the senior leadership team, the Board
will continue to focus on the delivery of the Group’s
strategy in 2026 through our Corporate Plan. Other
priorities for the Board in 2026 include:
• Continuing to strengthen Group-wide oversight
and governance arrangements, with a particular
focus on readiness to comply with revised
Provision 29 of the Code which requires boards to
make a declaration on the effectiveness of their
material internal controls;
• Approving the Group’s approach to managing
climate-related risks, and providing oversight of
the approach to delivery;
• Maintaining a clear focus on delivering excellent
customer outcomes, supported by continued
oversight of Consumer Duty compliance;
• Maintaining an awareness of geopolitical and
economic risks and assessing the potential
impact of those risks on members and the
communities served by the Group;
• Continuing its oversight of the Society’s and the
Group’s change programmes, ensuring effective
delivery and the Group’s ability to optimise
opportunities arising from technology.
Conclusion
In summary, with the exception for the matters
explained at the beginning of this report, I believe
that the governance arrangements operated by the
Group align with the Code’s requirements and have
enabled the Board to exercise effective oversight of
business performance, regulatory requirements and
delivery of our customer proposition.
Signed on behalf of the Board:
G Burr
Gwyn Burr
Chair, Skipton Group
17 February 2026
Performance & Strategy Governance
Financial Statements
Other Information
Skipton Group Annual Report & Accounts 2025 84
Membership and attendees
The members of the Board Audit Committee during
the year were:
The Committee is comprised of three members, all
of whom are independent non-executive directors.
Graham Lindsay joined the Committee from 19 May
2025. Mark Lund and Philip Moore stepped down
from the Committee at the 2025 AGM.
The Board is satisfied that the composition of the
Board Audit Committee includes non-executive
directors with recent, relevant financial experience
and sufficient understanding of the financial services
sector to provide appropriate challenge to
management. The relevant experience of the
members of the Board Audit Committee is set out in
the Board of Directors section.
In terms of good governance and to ensure holistic
oversight, I am also a member of the Board Risk
Committee (as is Denis Hall).
Meetings
The Committee held five scheduled meetings during
2025 aligned to our financial calendar and reporting
dates. The attendance of members at these
meetings is set out in the Corporate Governance
Report.
The Committee also held private discussions during
the year with the external auditor Ernst & Young LLP
(EY), the Group Chief Financial Officer, the Group
Chief Risk Officer, the Group Chief Internal Auditor
and the Chief Financial Officers of the Group’s
subsidiaries, to provide an opportunity for any
relevant issues to be raised directly with Committee
members.
In addition to Committee members, others who
regularly attended meetings (by invitation) include
the Chair of the Board, the Group Chief Executive, the
Group Chief Financial Officer, the Director of Group
Finance, the Group Secretary and General Counsel,
the Group Chief Risk Officer, the Head of
Compliance, the Group Chief Internal Auditor and
external auditor representatives.
Role and responsibilities of the Committee
The responsibilities of the Committee are delegated
by the Board and are set out in its written terms of
reference which are available on our website at
skipton.co.uk/about-us/governance. These were
reviewed and approved in May 2025 and are in line
with the provisions of the Financial Reporting
Council’s (FRC) ‘Guidance on Audit Committees’
which was last updated in April 2016 and have
Iain Cummings Non-Executive Director (Chair)
Denis Hall Non-Executive Director
Graham Lindsay Non-Executive Director and
Senior Independent Director
Performance & Strategy Governance
Financial Statements
Other Information
Dear Member,
On behalf of the Committee, I am pleased to
present this year’s Board Audit Committee Report,
which provides an overview of how we, as a
Committee, have discharged our responsibilities,
setting out the significant issues we have
reviewed and concluded on during the year.
The report focuses mainly on the following three
areas:
• The role and responsibilities of the Committee;
• The main activities of the Committee during the
year; and
• A review of the effectiveness of the Committee.
Iain Cummings,
Chair of the Board Audit Committee
Skipton Group Annual Report & Accounts 2025 85
regard to the FRC’s Audit Committee and the
External Audit: Minimum Standard.
Our primary responsibilities are:
• To monitor the integrity of the Group’s financial
reporting process, by reviewing, challenging and
recommending the Group’s annual and interim
financial statements to the Board for approval;
and reviewing, challenging and approving any
formal announcements relating to the Group’s
financial performance. We also review the
appropriateness and application of our
accounting policies, the impact of any changes to
them; and the significant estimates and
judgements in relation to the financial statements;
• To review the effectiveness of the Group’s
internal controls, including financial controls and
risk management systems;
• To review the effectiveness and independence of
the Group Internal Audit and Compliance
Monitoring functions and the performance of the
Group Chief Internal Auditor. This includes
considering the adequacy of internal audit's
resources, its periodic audit plans, performance
against these plans, their material findings and
delivery of actions to address them;
• To provide advice to the Board on whether the
Annual Report & Accounts, taken as a whole, are
fair, balanced and understandable and provide the
information necessary for members to assess the
Group’s strategy, business model and
performance; and
• To provide oversight of the external audit process
by monitoring the relationship with the external
auditor, agreeing their remuneration and terms of
engagement, monitoring their performance,
objectivity and independence. To ensure the
effectiveness of the external audit process, we
also review their approach to our audit, their
levels of materiality and their reports.
These responsibilities reflect key provisions outlined
in the Financial Reporting Council’s (FRC) Audit
Committees and the External Audit: Minimum
Standard.
Activities of the Committee during the year
During 2025 our work fell under three main areas, in
line with our responsibilities, as follows:
a) Internal controls and risk
The Group recognises the importance of good
systems of internal control in the achievement of its
objectives and the safeguarding of its assets and the
interests of its members. Good internal controls also
facilitate the effectiveness and efficiency of
operations, help to ensure the reliability of internal
and external reporting and assist in compliance with
applicable laws and regulations.
The Group operates in a dynamic business
environment and, as a result, the risks it faces
change continually. Management is responsible for
designing the internal control framework to ensure
thorough and regular evaluation of the nature and
extent of risk, and the Group’s ability to react
accordingly. Management is also responsible for
implementing the Board’s policies on risk and
control, noting that all employees are responsible for
internal control as part of their individual objectives.
Further details of the Group’s risk management
practices are provided in the Risk Review.
Through the Committee, the Group Internal Audit
function provides independent assurance to the
Board on the effectiveness of the internal control
framework. Group Internal Audit derives its authority
from the Board, through the Board Audit Committee,
and has unrestricted access to all Group records,
physical properties, and personnel as required for the
effective delivery of audit activity.
The information received and considered by the
Committee during 2025 provided assurance that
there were no significant control failings that would
lead to a material impact on the Group’s financial
statements.
Group Internal Audit is supported by external co-
source partners who provide specialist technical
support when required. The Group Chief Internal
Auditor reports directly to me to maintain their
independence from Executive Management. As a
Committee we are responsible for ensuring that
Group Internal Audit has adequate skills and
resource levels that are sufficient to provide the level
of assurance required.
The Board Audit Committee is also responsible for
approving the annual budget of Group Internal Audit
and for approving its annual plan of work. This is
prepared on a risk-based approach reflecting input
from management and the Committee.
We review reports produced by Group Internal Audit
that detail material findings, recommendations and
the status of management actions in
response. Group Internal Audit also verify the
completion of management actions using a risk-
based approach and updates the Committee on
progress.
During the year, key areas reviewed were as follows:
• The governance framework and key controls
around significant prudential and financial risk,
including capital and liquidity management;
Performance & Strategy Governance
Financial Statements
Other Information
Skipton Group Annual Report & Accounts 2025 86
• Key controls around cyber security, operational
resilience and information technology;
• Key controls to ensure regulatory compliance in
areas including, model risk management
Consumer Duty and responsible lending for
example; and
• A number of specific areas of internal control in
the Group’s subsidiaries, including key change
projects.
We monitor and assess the role and effectiveness of
the Group Internal Audit function in the overall
context of the Group’s risk management systems.
The Committee assesses the effectiveness and
independence of Group Internal Audit annually, and
this is reported to and discussed at a meeting of the
Committee.
We also review the results of Group Internal Audit’s
Quality Assurance and Improvement Programme
annually and oversee progress against Group
Internal Audit’s Strategic roadmap. Group Internal
Audit’s performance is monitored by the Committee
against a balanced mix of measures, covering
Quality, Delivery, Talent and Innovation.
The Committee is satisfied that, throughout 2025,
Group Internal Audit was appropriately resourced to
carry out its responsibilities, was independent, and
that it continued to perform effectively.
The Committee also has oversight responsibility for
the Society’s Compliance Monitoring function that
provides second line assurance over conduct risk on
activities regulated by the FCA, as well as assurance
over financial crime and data protection. The
Compliance Monitoring Plan includes control
reviews, shorter focused reviews and customer
outcomes testing which includes, but is not limited
to, investment, pension, mortgage and protection
advice, credit management, complaint handling and
post-sale customer outcomes. Consideration is
given to Consumer Duty as part of all relevant
reviews and consumer duty specific reviews are also
included in the plan where relevant. The Compliance
Monitoring function’s plan of work was approved by
the Committee and the outputs reported to the
Committee, together with progress updates on
management’s implementation of actions to address
the findings.
As part of the external audit process, the Society’s
auditor provides us with reports on the results of
their testing of the effectiveness of internal controls.
b) Financial reporting
The Committee considered the financial information
published in the Group’s annual and interim financial
statements and the accounting policies adopted by
the Group, presentation and disclosure of financial
information and the key estimates and judgements
made by management in preparing the financial
statements. The Committee also considered and
approved the Group’s Pillar 3 disclosure which is
available at skipton.co.uk/about-us/pillar-3-
disclosure.
The Directors are responsible for preparing the
Annual Report & Accounts. At the request of the
Board, we considered whether the 2025 Annual
Report & Accounts were fair, balanced and
understandable and whether they provided the
necessary information for members to assess the
Group’s position and performance, business model
and strategy.
This assessment included:
• Review of reports from management on
significant accounting matters and judgements
and challenge as to whether these treatments
were appropriate;
• Review of the continued appropriateness of the
Group’s accounting policies;
• Review of the use of models and their
appropriateness for determining values within the
financial statements;
• Consideration of the Group’s reporting processes
and the robustness of oversight procedures;
• Consideration with management of leading
reporting practices and recommendations,
including those published by the FRC and major
audit firms;
• Consideration of the main events during the
financial year and how these are reported in our
financial statements;
• Review of the alternative performance measure of
underlying profit before tax (defined in the
Financial Review), to ensure compliance with our
policy on these metrics and fair presentation;
• Reviewing drafts of the financial statements and
discussion of key matters; and
• Consideration by the Committee of comments
raised by our external auditors and actions taken
by management to address these.
Performance & Strategy Governance
Financial Statements
Other Information
Skipton Group Annual Report & Accounts 2025 87
We paid particular attention to matters we
considered to be important by virtue of their impact
on the Group’s results, and particularly those which
involved a high level of complexity, judgement or
estimation by the Board.
The key areas of estimate and judgement that we
considered in reviewing the 2025 Annual Report &
Accounts are set out below:
Significant matter
Committee action taken
Impairment of
financial assets
The Committee has monitored loan impairment provisions, taking account of the
requirements of IFRS 9 Financial Instruments. During the year, the Committee
undertook the following work in relation to impairment:
• Reviewed and challenged the critical judgements made by management, including
the appropriateness of the Probability of Default (PD), Loss Given Default (LGD)
and Exposure at Default (EAD) models.
• Assessed management’s approach to Significant Increase in Credit Risk (SICR),
staging criteria, and the triggers used for movement between Stage 1, Stage 2 and
Stage 3.
• Considered the selection and weighting of forward-looking macroeconomic
scenarios, including the severity of downside scenarios and revisions to reflect
changes in the external environment.
• Considered the impact of key economic assumptions within the Group’s loan
impairment models on the level of provisions made and the relevant disclosure in
the Accounts.
• Examined and challenged the assumptions adopted, including key sensitivities of
the model, and scrutinised reports produced by management on the operation of
the impairment framework, including controls over data quality, model
performance, and monitoring of model limitations.
• Challenged the rationale and evidence supporting any Post Model Adjustments
(PMAs), ensuring that adjustments were transparent, well-governed and reserved
only for areas of model uncertainty.
• Assessed the risk recognised in respect of impairment relating to the SIL loan
book.
• Monitored the level of impairment held against treasury assets under IFRS 9,
including scrutinising reports produced by the Asset & Liability Management
function. We consider the level of impairment held against these assets to be
appropriate.
Based on the work performed throughout the year, the Committee is satisfied that the
impairment of financial assets, has been prepared on an appropriate basis, that the
key judgements, together with post model adjustments that have been applied, are
reasonable, and that the related disclosures in the Annual Report and Accounts are
fair, balanced and understandable.
Performance & Strategy Governance
Financial Statements
Other Information
Skipton Group Annual Report & Accounts 2025 88
Significant matter
Committee action taken
Fair valuation of
the equity release
portfolio
The Group’s equity release portfolio is closed to new business. It continues to be
measured using an internally developed fair value model based on discounted future
cash flows. Key assumptions
—such as mortality, voluntary redemption behaviour,
house price growth, RPI, non
-negative equity guarantee (NNEG) costs and illiquidity
premiums
—
remain consistent with the prior year and are subject to established model
governance and second
-line oversight.
The Group hedges the interest rate and inflation risk arising from its equity release
portfolio through the use of derivatives which are also valued on a discounted cash
flow basis. Due to their long
-dated nature, changes in assumptions can significantly
impact valuations. As the underlying mortgage portfolio is not held at amortised cost
under IFRS 9, hedge accounting cannot be applied. Both the equity release portfolio
and the swaps are held at fair value through profit and loss.
There is some natural offsetting between the changes in value of the portfolio and the
derivatives, but this is not perfect, partly due to the different discounting requirements.
During the year, the Committee undertook the following work in relation to the fair
valuation of the equity release portfolio:
• Reviewed management’s supporting papers and assumptions. Considering the
specific characteristics of this portfolio, and general macro-economic indicators,
the Committee considers that the inputs and assumptions, and therefore the
valuation of the equity release portfolio is appropriate.
• Reviewed the control framework, assumptions, and key sensitivities disclosed in
Note 1v) to the Accounts and is satisfied that amounts recognised in the Income
Statement are fairly stated and that the valuations of the derivatives are
appropriate.
• Assessed the sensitivity of the fair values to changes in key assumptions and
confirmed that the sensitivities disclosed in the Accounts are appropriate and fairly
presented.
Defined benefit
pension liability
The Group manages three funded defined benefit pension schemes, as presented in
Note 36 to the Accounts.
The Committee has examined and challenged the pension scheme assumptions
adopted in these Accounts and
is satisfied that these are reasonable and appropriate;
this included consideration, in particular of the accounting/reporting impact of the
Skipton scheme buy
-in and the associated loan to the Scheme from the Society.
Impairment of
estate agency right-
of
-use assets
The Committee has considered the risk relating to the impairment of estate agency
right
-of-use assets. The Committee reviewed assessments prepared by management
and the results of impairment testing performed where indicators of impairment exist.
The Committee is satisfied that the level of provision held against right
-of-use assets
is appropriate.
Revenue recognition
within the estate
agency division
The Committee has considered the risk relating to the recognition of revenue within
the estate agency division, as described by the external auditor within the Independent
Auditor’s Report. The Committee reviewed reports prepared by management and by
EY regarding the effectiveness of key controls over the revenue recognition process.
The Committee also considered the results of external audit testing performed in this
area, including testing performed in previous years, which has not identified any
evidence of material misstatement or management override in this respect.
The Committee is comfortable that this matter has been appropriately considered and
disclosed within these Accounts.
Performance & Strategy Governance
Financial Statements
Other Information
Skipton Group Annual Report & Accounts 2025 89
Significant matter
Committee action taken
Revenue
recognition relating
to effective
interest rate
accounting
Interest income on the Group’s mortgages is measured under the effective interest
rate method, as explained in Note 1f) to the Accounts. This method includes an
estimation of mortgage product lives. The Committee reviewed the reports prepared
by management to support these estimates and is satisfied with the conclusions
reached in this respect.
Derivatives and
hedge accounting
The Group uses fair value and cash flow hedge accounting to manage its interest rate
and foreign currency risk.
The Committee has examined and challenged the valuation of derivative financial
instruments and is satisfied that these are reasonable and appropriate.
Going concern and
longer
-
term viability
review
The Committee performed the following:
• Reviewed and confirmed the appropriateness of the going concern assumption for
both the Interim Accounts and the Annual Accounts, ensuring a consistent
assessment approach across reporting periods.
• Considered reports from key risk functions covering current and forecast liquidity,
capital, and funding positions.
• Evaluated the Group’s principal risks, including credit, liquidity, operational, and
conduct risks; Market developments; Social, economic, and political factors; and
Climate-related risks.
• Assessed the impact of relevant stress scenarios on the Group’s financial
resilience.
Based on the above the Committee concluded that the preparation of the financial
statements on a going concern basis remains appropriate.
Additionally, the Committee performed the following in respect of the Group’s longer
-
term viability statement in the Directors’ Report:
• Reviewed management papers and risk analyses supporting the Directors’ Viability
Statement.
• Considered the Group’s corporate plans, long-term financial resilience, and
potential severe-but-plausible failure scenarios.
• Determined that the likelihood of any scenario materialising that would threaten
the Group’s long-term viability is sufficiently low.
c) External Audit
The Committee assesses the effectiveness and
independence of the external auditor annually
following completion of their year-end audit, and this
is reported to and discussed at a meeting of the
Committee shortly thereafter. This assessment
covered the external audit of the previous Annual
Report & Accounts, and included consideration of
matters such as:
• Any risks to audit quality that the external auditor
identified;
• The key controls that the external auditor relied
on to address any identified risks to audit quality,
such as appropriate audit methodologies, training
and quality control policies and procedures;
• The findings from internal and external
inspections of the external audit and the audit
firm;
• Whether the original audit plan was met;
• Openness and quality of communication between
the external auditor and senior management;
• The skills and experience of the audit team and
their understanding of the business;
• Whether an appropriate degree of challenge and
professional scepticism was applied by the
external auditor; and
• The proposed strategy to be used in the next
audit, including the proposed level of materiality
to be used.
Performance & Strategy Governance
Financial Statements
Other Information
Skipton Group Annual Report & Accounts 2025 90
The Committee considered the results of this review
and concluded that the external auditor had
performed an audit of good quality and that they
were sufficiently independent.
The Committee also reviewed and reaffirmed our
policy on non-audit services which can be provided
by our external auditors. The Committee reviews
fees paid to the Group’s auditor regularly and is
satisfied that the level of non-audit fees paid to our
external auditors complies with this policy and does
not compromise their independence or objectivity.
Details of the fees paid to EY for audit and non-audit
services are set out in Note 7 to the Accounts; non-
audit fees during the year represented 5.3% of total
EY audit fees for the Group (2024: 5.4%). To further
maintain auditor independence, the Group has
processes in place regarding the employment of
former employees of the auditor.
EY were appointed as external auditor following a
competitive tender process and their appointment
was approved by members at the AGM on 29 April
2019. EY were reappointed as the Society’s external
auditor at the 2025 AGM and the Audit Committee
has recommended to the Board that they be
approved for reappointment as external auditor at
the 2026 AGM. The Committee continues to monitor
auditor tenure to ensure compliance and best
practice. The Committee also reviewed advisory and
consulting fees paid to other firms which could be
suitable auditors of the Group. This is done
periodically to ensure that if a change of auditor is
required, we have appropriate options.
The Committee has overseen the external audit
process having regard for the FRC’s Audit
Committees and the External Audit: Minimum
Standard, confirming auditor independence,
transparency, and effectiveness.
We considered matters raised during the statutory
external audit and the half year independent review
and, through discussion with senior management of
the business and the external auditor, concluded that
there were no adjustments required that were
material to the financial statements as presented
d) Other matters
Other matters considered by the Committee during
the year include the following:
• Received and approved the Group Sustainability
Report, Group Climate-Related Financial
Disclosures and the Society’s and SIL’s Principles
for Responsible Banking Self-Assessment Report;
• Conducted the annual review of the Speak Out
(Whistleblowing) policy and received the annual
whistleblowing oversight report;
• Received a progress update from Group Risk on
activity to support adherence to the revised
Provision 29 of the UK Corporate Governance
Code; and
• Refined the approach to governance and
oversight of subsidiary company’s audit & risk
committees.
Effectiveness of the Board Audit Committee
The effectiveness of the Committee was assessed
as part of the most recent internal Board
performance review the results of which were
presented in April 2025 and which concluded that we
operated effectively during the year.
Committee members undertake relevant training as
part of their ongoing development and, periodically,
the Committee as a whole receives training on
current topics such as sustainability and climate-risk
reporting requirements, sector challenges, regulatory
developments, conduct risk issues and financial
reporting ‘hot topics’ to ensure we remain effective in
our role.
Iain Cummings
Chair of the Board Audit Committee
17 February 2026
I Cummings
Performance & Strategy Governance
Financial Statements
Other Information
Skipton Group Annual Report & Accounts 2025 92
Members of the Board Change Committee
The Committee is comprised of three members, Iain
Cummings, Graham Lindsay and I, all of whom are
independent Non-Executive Directors with significant
change management experience. Iain serves as
Chair of the Board Audit Committee and is a member
of the Board Risk and Board Nominations
Committees and Graham, our Senior Independent
Director for the Group, is a member of the Board
Audit, Board Nominations and Board Remuneration
Committees. I also serve as a member of the Board
Risk, Board Nominations and Board Remuneration
Committees. Together these arrangements ensure
good interaction between the various committees of
the Board.
The Committee was established by the Board during
2023 to oversee and govern the increasing scale and
complexity of the Group’s on-going change strategy.
During 2025 the Committee held four meetings.
Attendance of its members at those meetings is set
out in the Corporate Governance Report.
In addition to Committee members, other attendees
(by invitation) included the Group Chief Executive,
the Group Chief Information Officer, the Group Chief
Financial Officer, the CEO Homes, the CEO Money
and the Group Secretary and General Counsel. The
Committee received regular reports directly from
members of senior management across the Group
responsible for delivering our change agenda. These
included updates from Connells, SIL, Jade and SBF
as well as the Society and Group functions.
Role and responsibilities of the Committee
The Committee seeks to ensure change is delivered
as efficiently and effectively as possible and that the
impact on members, customers and colleagues is
positive and well handled.
The responsibilities of the Committee are delegated
by the Board and are set out in our Terms of
Reference which are available on our website at
skipton.co.uk/about-us/governance.
The Committee’s role is to provide guidance,
challenge and advice to the Executive Team on
behalf of the Board, to shape how change is
delivered across the Group. The Change Portfolio is
the programmes of work, systems and controls
through which changes to our business are
prioritised, coordinated and implemented. The
Committee’s primary responsibilities are:
• To oversee the alignment of the Change Portfolio
with the technology, process and people
strategies and be satisfied that the Change
Portfolio supports the Group’s strategic vision;
• To oversee the Change Portfolio priorities and
methodology, including the capacity to resource
and absorb change;
Performance & Strategy Governance
Financial Statements
Other Information
Dear Member,
On behalf of the Board Change
Committee, I am pleased to present
the Committee’s annual report
covering the role of the Committee
and how it has discharged its
responsibilities during 2025.
Heather Jackson,
Chair of the Board Change Committee
Skipton Group Annual Report & Accounts 2025 93
• Review of significant change proposals before
presentation to the Board for approval;
• Review of assurance reports and management
actions to address any findings;
• Scan the horizon for future industry trends and
opportunities in technology that could impact or
benefit the Group; and
• To oversee and challenge change initiatives
including:
• Progress and delivery, including risk
management, benefits and outcomes;
• Financial management, including spend
and benefits delivery;
• The overall approach, including ‘lessons
learned’ when initiatives are completed;
• Adequacy of resource, including
appropriate levels of resourcing roles,
responsibilities and skills; and appropriate
use of data.
Activities of the Committee
Throughout 2025, the Committee has focused on:
• Ensuring the Change Portfolio aligns with the
Skipton Group Corporate Plan, including future
planning, delivered outcomes, and required
investments. This ensures the change we execute
builds to deliver the strategy set by the Board.
• Receiving updates from the Group Technical
Council, such as capability frameworks and
architectural models which helps ensure the
architectural approaches taken maximise re-use,
future-proofing and cross-Group opportunities.
• Promoting consistent approaches to change
delivery through the introduction of a
standardised Change Management Framework
which supports regular assessment of progress,
costs, effectiveness, and value. Additionally, we
have increased the visibility of each Group
Company’s change portfolio as well as promoting
the sharing of skills and knowledge, strengthening
collaboration and accelerating value creation.
• Monitoring the Society’s Digital Transformation
Programme, with a strong focus on delivering
member benefits, enhancing ease of use, and
driving measurable impact. Notably, the
Committee has overseen the successful rollout of
our new Customer Engagement Platform,
designed to significantly improve customer
servicing. In addition, we have overseen the
migration of the first cohorts of customers to our
new mobile app, marking a key milestone in our
digital journey.
• Enhancing quality of change initiatives by
assessing member and colleague impacts,
resource use, and incorporating post-
implementation reviews and second and third-line
inputs.
• Reviewing overall resourcing of change, including
where we use third party partners; ensuring they
are efficiently and appropriately adding value to
our change work and delivering clear returns on
investment. Additionally, we have also sought to
ensure recruitment and training strategies
maintain future-ready change capabilities.
• Overseeing robust and proportionate risk
management that balances the urgency of
change with the need to mitigate potential
negative impacts, safeguarding both strategic
objectives and operational stability, with a
specific focus on cyber risk mitigation and other
critical security considerations.
• Importantly in 2025 the Executive Team have
worked to enhance tracking of benefits delivered,
ensuring clear accountability for return on
investment. This will remain a priority and receive
ongoing focus throughout 2026.
• We have monitored progress on the Group’s Data
Strategy, delivering tangible benefits for members
and colleagues, unlocking new insights, and
capitalising on AI opportunities. The Skipton
Group Home Affordability Index demonstrates our
ability to leverage Group data alongside leading
economic sources to provide a clear view of UK
housing market trends.
• During every meeting, we consider the threats and
opportunities of change which includes a horizon
scanning topic on emerging technologies. In 2025
these were on: data usage, quantum computing,
cybersecurity, and further AI opportunities,
especially in mortgages.
Looking forward
Over the course of 2026, the work of the Committee
will continue to evolve and will include:
• Considering the change and technology required
to support the aims of the Group’s Corporate
Plan. Specifically, the Committee will oversee the
delivery of major change initiatives, including:
• Migration of the Society’s customers to a
new mobile app, coupled with
improvements giving colleagues faster,
clearer access to customer accounts -
enabling quicker service and better
customer interactions;
Performance & Strategy Governance
Financial Statements
Other Information
Skipton Group Annual Report & Accounts 2025 94
• The roll out of new technology across
Connells’ estate agency business to
increase colleague efficiency and improve
customer service; and
• Strengthening fraud prevention through
faster and more secure customer
identification processes within SIL and
SBF.
• Continued review of the member and colleague
impact from change alongside oversight of
delivery, risk, financial management and
implementation of change across the Group;
• Reviewing required Group capabilities, and the
architecture, data and resource strategies for
change across the Skipton Group and continuing
to foster the sharing of Group skills and
experiences to best effect; and
• Continuing to explore new industry and
technology developments relevant to the work of
the Committee and understanding how those
developments can assist us to better serve our
members in the future. These may include
exploration of the use of Artificial Intelligence,
Digital Currencies and Identity, Cyber Security and
consideration of the future of Quantum Compute.
Conclusion
In fulfilling the above, we aim to ensure the change
we make is in the best interests of our customers
and colleagues now and in the future. On behalf of
the Committee, this report highlights the work
undertaken and underscores the importance of its
future role.
H Jackson
Heather Jackson
Chair of the Board Change Committee
17 February 2026
Performance & Strategy Governance
Financial Statements
Other Information
Skipton Group Annual Report & Accounts 2025 96
In 2025, we further strengthened our Group Risk
Management Framework to enable a more
consistent, proactive approach to the identification,
assessment, mitigation and ongoing management of
risks. This included strengthening governance
practices and improving oversight mechanisms to
align with upcoming changes to the UK Corporate
Governance Code.
Committee focus
In line with the Group Risk Management Framework,
the Board Risk Committee has focused on the
following areas during the year:
• Liquidity management, to ensure that the Group
maintains a prudent liquidity position and is well
placed to respond to the uncertain geopolitical
environment, while preserving our diversified
funding base.
• Capital and MREL, to ensure that the Group
maintains sufficient capital resources to support
our business strategy and potentially respond to a
severe economic stress.
• Cyber threats, to ensure that the Group has
effective tools, supported by a plan of continuous
improvement, to reduce the impact of a potential
cyber-attack. We remain alert to this risk given
ongoing geopolitical tensions and recent high-
profile attacks on UK firms.
• Artificial intelligence, to ensure we have
appropriate risk oversight and capabilities to
responsibly harness the power of AI.
• Credit performance, to ensure that the Group
appropriately evaluates and balances risk and
reward in a competitive mortgage market.
• Conduct risk, ensuring delivery of the Society’s
values and compliance with Consumer Duty, with
a focus on achieving good outcomes and fair
value for members and customers.
• Operational resilience, to ensure the Society and
Group businesses can recover in a swift and
organised manner in the event of an operational
failure, providing a reliable and resilient service to
members and customers.
• Climate risk, to ensure that the Group is
responding appropriately and with purpose to the
associated physical and transitional risks.
To assist the Board Risk Committee’s deliberations,
it receives regular reports from the Group Chief Risk
Officer. These reports provide clarity on the key and
emerging risks faced by the Group and direct the
Committee’s attention to those matters which the
Risk Officer believes warrant further consideration.
Risk appetite
Day-to-day operation of the business naturally
exposes the Group to a range of potential risks. To
limit the level of risk accepted by the Group in the
normal course of business, the Board has
established a risk appetite. This is reviewed, at least
annually, in the context of the prevailing environment
in which the Group operates.
Performance & Strategy Governance
Financial Statements
Other Information
Dear Member,
As the Chair of the Board Risk
Committee, I am pleased to present
the 2025 Board Risk Committee
Report. This report explains the risk
management practices we operate at
Skipton, and the key areas of focus
for the Board Risk Committee
through 2025.
Denis Hall,
Chair of the Board Risk Committee
Skipton Group Annual Report & Accounts 2025 97
Governance structure
To enable appropriate focus on risk matters, the
Board has delegated oversight of risk management
to the Board Risk Committee, although ultimate
responsibility continues to reside with the Board
which receives regular reporting to support its
oversight of risk. In addition, the Board receives
verbal updates from the Board Risk Committee Chair
on key topics of discussion and any concerns.
The Board Risk Committee is supported by an
Executive Risk Committee which is chaired by the
Group Chief Risk Officer. This is the primary
Executive body which meets regularly to oversee and
monitor the key risks across the Group, including
overseeing several specialist sub-committees
addressing specific risk areas, such as credit,
conduct, and operational risk.
At a Group business level, Connells, SIL and Jade
operate their own Audit and Risk Committees which
report directly to their respective boards. The Group
Chief Risk Officer maintains oversight of all Group
businesses in relation to risk management and
control.
Membership and attendees
The members of the Board Risk Committee during
the year were:
Corporate Governance Code readiness
In anticipation of the revised Provision 29 of the UK
Corporate Governance Code which comes into effect
in January 2026, the Group has undertaken a
programme of work in 2025 to further enhance and
strengthen existing approaches.
This activity focused on review and refinement of our
Group risk taxonomy to ensure this remains
reflective of the changing risk landscape and
business practices. We have also further
strengthened our Risk and Control Self-Assessment
process to embed a culture of risk ownership and
continual improvement, supported by a strong
understanding of our material control activities.
Group-wide risk reporting has also been enhanced to
provide a clear, aggregated view of current and
emerging risks to the Board.
Group Risk Management Framework
The Group operates a formal Risk Management
Framework that strengthens oversight, ensures
consistent identification and mitigation of both
emerging and known risks, and supports decision-
making across the business.
This comprehensive framework is designed to
enable delivery of the Corporate Plan in line with the
Board’s overall risk appetite. The framework defines
the principal risks to which the Group is exposed
along with governance expectations and roles and
responsibilities for the management of these risks.
The framework supports regulatory compliance,
promotes proactive risk culture, protects members’
interests and enables sustainable growth. It is
underpinned by a clear ‘three lines of defence’ model
with clearly defined roles and accountabilities:
The Group is alert to emerging risks and regulatory
changes. These are considered at each meeting of
the Board Risk Committee and by the Group Chief
Risk Officer on a day-to-day basis. Our reporting
process provides the Board and Board Risk
Committee with a robust continuous assessment of
the principal risks and risk environment across the
Group and enables it to challenge management on
its mitigation plans in a timely manner.
Performance & Strategy Governance
Financial Statements
Other Information
The first line of defence is formed by the frontline
business areas and operational teams that own
and manage risks directly. They are responsible
for identifying, assessing and managing risks
within their day-to-day activities, ensuring
processes are followed, controls are effective, and
issues are escalated promptly.
The second line of defence comprises our Group
Risk function and embedded risk teams, which
provide independent oversight, challenge, and
guidance to ensure risks are appropriately
identified, assessed, and managed by the first line.
The Board Risk Committee Chair safeguards the
independence of the second line by ensuring it can
exercise objective challenge without constraint.
The third line of defence, provided by Group
Internal Audit, is designed to provide risk-based
independent assurance to the Board (through the
Board Audit Committee) of the adequacy and
effectiveness of control systems operating within
the first and second lines in identifying and
managing risk.
Denis Hall (Chair) Non-Executive Director
Iain Cummings Non-Executive Director
Hasintha Gunawickrema Non-Executive Director
Heather Jackson Non-Executive Director
Skipton Group Annual Report & Accounts 2025 98
To meet the CRD V Pillar 3 requirements, the Group
publishes further information about its exposures and
risk management processes and policies on the
Society’s website skipton.co.uk.
Conclusion
The geopolitical and economic events that shaped
2025 are being closely monitored by the Group. Some
economic uncertainty exists in the markets in which we
operate, and whilst it may be difficult to predict the
outcome of such uncertainty, I am confident that the
Risk Management Framework operated by the Skipton
Group enables it to identify, assess and manage the
risks confronting it and support business sustainability.
To underpin this, the Board Risk Committee will
continue to promote a culture which views risk
management not as an additional activity but as
embedded in how the business is run.
Denis Hall
Chair of the Board Risk Committee
17 February 2025
D Hall
Performance & Strategy Governance
Financial Statements
Other Information
Skipton Group Annual Report & Accounts 2025 100
Dear member,
On behalf of the Board Remuneration Committee,
I am pleased to share the Directors' Remuneration
Report. This sets out the details of the Executive
Directors' pay, incentives and benefits and the
Non-Executive Directors' fees for the year ended
31 December 2025.
Our Directors’ Remuneration Report for the year
ended 31 December 2024, as well as our
Directors’ Remuneration Policy which applies until
the 2028 Annual General Meeting (AGM), received
strong support from our members at the 2025
AGM (with both receiving 92% of votes ‘FOR’) .
I would like to thank our members for their
ongoing support.
Steven Davis,
Chair of the Board Remuneration Committee
The Committee and its advisers
The members of the Board Remuneration Committee
are all independent Non-Executive Directors of the
Society and include members of the Board Risk, Board
Audit and Board Change Committees. The Committee
during the year included the following Non-Executive
Directors:
• Steven Davis, Non-Executive Director (Chair).
• Heather Jackson, Non-Executive Director (Chair of
the Board Change Committee and member of the
Board Risk Committee.
• Mark Lund, Non-Executive Director (member of
the Board Audit Committee). Mark Lund stepped
down from the Committee on 28 April 2025.
• Graham Lindsay, Senior Independent Director
(member of the Board Audit Committee). Graham
Lindsay joined the Committee on 19 May 2025.
In addition to Committee members, regular attendees
at Committee meetings include the Group Chief
People Officer, the Group Secretary and General
Counsel, and PwC, our independent external
consultants.
The Group Chair has a standing invitation to all
meetings of the Committee. The Group Chief
Executive, Group Chief Risk Officer and the Director of
Reward and Governance attend meetings by
invitation. The Committee met on eight occasions in
2025.
The purpose of the Board Remuneration Committee
• To determine, on behalf of the Board, the
Directors’ Remuneration Policy.
• To ensure that remuneration arrangements
support and encourage desired behaviours and
culture.
•
To maintain policies for the Group which are
compliant with applicable governing laws and
regulations and aligned, where appropriate, to the
remuneration expectations of the PRA and FCA
and those set out in the UK Corporate Governance
Code.
•
To ensure appropriate governance of
remuneration practices across the Group, which is
defined as the Society and its subsidiary
undertakings, including the following key
businesses: Connells, SBF, SIL, and Jade; and to
exercise effective oversight of these.
•
To ensure that remuneration policies, principles
and practices are appropriate, market competitive,
compelling to new hires and fair and equitable to
existing colleagues, to enable the Group to attract,
retain and reward people with the right skills
experience, knowledge and behaviours to support
achievement of the Group’s strategic objectives
and the successful delivery of its long-term
strategy and to promote long-term sustainable
success.
Performance & Strategy Governance
Financial Statements
Other Information
Skipton Group Annual Report & Accounts 2025 101
Amongst its other duties, the Board Remuneration Committee has responsibility for:
• Setting the Remuneration Policy: Defines and agrees remuneration policies and principles on behalf of the
Board, ensuring they align with the Group’s strategy, risk profile, values, regulatory requirements and long-
term member interests.
• Group Oversight and Compliance: Ensures remuneration policies operate as intended and aligns with the
Board Audit and Risk Committees to promote sound risk management.
• Group-wide Risk-adjusted Remuneration: Maintain robust processes for risk adjustment, considering risk
appetite, capital, liquidity and overall performance. Reviews variable pay against performance targets and
applies malus or clawback where appropriate.
• Executive and Senior Pay Decisions: Determines remuneration for the Society’s Chair, executive directors,
senior officers in Risk and Compliance and other Material Risk Takers and executive directors across the
Group. Reviews and approves senior executive pay proposals recommended by the Group Chief Executive.
• Service Contracts: Sets the terms, objectives and content of Society executive directors and senior
executive service contracts across the Group to ensure alignment with policy, regulation and best practice.
• Exceptional Pay Reviews: Reviews any pay structures or proposals that fall outside established
remuneration principles.
The full terms of reference of the Board Remuneration Committee and the Remuneration Principles are
available on request from the Group Secretary and General Counsel. The terms of reference are also available
online at skipton.co.uk/about-us/governance.
We have set out this Directors’ Remuneration Report in the following four key sections:
1. An Annual Statement explaining the priorities of the Committee across reward for all colleagues and
summarising the remuneration policy for executive directors.
2. A Summary Directors’ Remuneration Policy in respect of the Society executive directors.
3. The Annual Report on Remuneration in 2025, which explains how the remuneration policy was
implemented during the 2025 financial year.
4. The 2026 Remuneration Outlook, which sets out our planned approach to applying the remuneration policy
in 2026.
Performance & Strategy Governance
Financial Statements
Other Information
Skipton Group Annual Report & Accounts 2025 102
The key matters discussed, and the decisions made by the Committee during 2025 are set out below.
Remuneration component
Action taken
2025 Pay Review
Approved the 2025 salary awards for the Group Executive Committee, senior
managers and Material Risk Takers (MRTs), in line with the all colleague pay
review.
2024 SVPA* outcomes &
payments
Approved annual bonus awards for all employees in scope of the PRA and
FCA remuneration rules in respect of the performance year 2024, considering
the Group Chief Risk Officer’s risk report, the Group Chief Financial Officer’s
sustainability review, performance outcomes versus scheme measures and
related personal performance objectives.
2025 Group LTIP** design
Approval and implementation
of overall grants for the LTIP, for the executive
directors and selected Group Executive Committee colleagues.
Determined
the key performance measures and targets across the following areas:
• Financial
• Non-financial
2025 SVPA
design
Determined the updated key performance measures and targets across the
following areas:
• Financial
• Customer and Colleague
• Environmental, Social and Corporate Governance (ESG)
• Personal performance objectives
2025 Connells group LTIP
design
Reviewed and approved the design and measures of the LTIP and annual
bonus measures
for the Connells executives for performance year 2025.
2025 Group Subsidiary
Executive Pay Review and
incentives
Approved the 2025 salary increases and 2024 bonus awards for the
Subsidiary executive directors.
Market and regulatory
review
Assessed external benchmarking data as an input to ensure Society
remuneration remains competitive and appropriate. Received updates on the
regulatory consultation on remuneration reforms and determined the
approach to be taken by the Group as a result of the updated rules.
2026 Variable Pay plans and
design
Considered and approved the design of the Society’s SVPA & LTIP plans and
associated measures for the performance year 2026.
2026 Pay Review
Approved the 2025 salary awards for the Group Executive Committee, senior
managers and Material Risk Takers (MRTs).
* SVPA stands for Senior Variable Pay Arrangement, which is the discretionary annual bonus plan in which the executive directors and
selected colleagues of the Group Executive Committee participate.
** LTIP stands for Long Term Incentive Plan, which is the discretionary three-year performance plan in which the executive directors and
selected colleagues of the Group Executive Committee participate.
Performance & Strategy Governance
Financial Statements
Other Information
Skipton Group Annual Report & Accounts 2025 103
Variable remuneration in respect of performance for
2025
A key objective for the Committee is to ensure the
remuneration of the Society’s executive directors is
both aligned with and drives business performance
across a range of measures taken from our
Corporate Plan. Each year we review the design and
focus of our annual bonus schemes to ensure
alignment with strategy and to ensure that they drive
the culture and behaviours we want to promote and
reward appropriately.
Financial and Customer performance
The scheme focused on three key financial metrics
for 2025, namely adjusted Group profit, adjusted
Society profit and Society administrative
expenses. Overall, as set out in the Group Chief
Financial Officer’s report Skipton Group’s financial
performance in 2025 has performed well, achieving
strong balance sheet growth, good profitability and a
stable capital position.
In 2025 our delivery against our purpose saw our
mortgage and savings book growth outpace the
market, with our Group mortgage book surpassing
£33bn, and our Society savings books surpassing
£30bn for the first time. Our Money business
continued to deliver seeing an increase in financial
advice conversations. Our Homes business
increased new lending to first-time buyers with our
segment market share increasing to 4.0% (2024:
3.8%). The combined success across the businesses
that make up the Skipton Group resulted in the
adjusted Group profit metric pay out, at 59.6% of
maximum (2024: 81.9%).
The Society’s net interest margin performed well in
2025 amidst a falling interest rate environment. The
Society delivered a resilient, above target
performance. As a result, the adjusted Society profit
metric pay-out remains strong, to 85.2% of maximum
(2024: 66.6%).
Administrative expenses for the Society increased
slightly by £0.4m compared to last year rising to
£262.4m (before any adjustments). We have
continued to invest in our service, through improved
digital pathways; and in our brand and our people,
whilst remaining focused on controlling our costs
and realising efficiencies. As a result, the
administrative expenses outturn is 67.3% of
maximum.
Our customer base has grown in 2025, and we have
maintained high satisfaction scores through our
delivery of both great service and products. In 2025 a
customer satisfaction score of over 90% was
achieved. The net customer satisfaction
performance measure achieved 10 out of 10 and will
pay out at 100% (2024: 90%).
Non-financial performance
In line with the Corporate Plan, two key non-financial
performance metrics were included for 2025. Two
Diversity and Inclusion metrics, focused on meeting
our Women in Finance Charter target and Ethnicity
target. The Society achieved an outcome of 48%
against the 2025 Women in Finance target (46.7% in
2024), which is a strong outcome compared to the
national average of 36% across financial services
organisations. This measure achieved 6 out of 10.
In line with our ongoing commitment to Diversity and
Inclusion, the Ethnicity metric score achieved 10 out
of 10, paying out at the maximum 100%.
A people-driven metric was first introduced in 2024.
In 2025 we introduced employee Net Promoter Score
to measure colleague engagement. By embedding
our new Society listening survey, we have turned
colleague feedback into actionable insight. As a
result, our engagement levels are now reporting at a
score of 42, with 89% of colleagues participating in
the survey. This metric in 2025 achieved 10 out of
10, paying out at 100%.
Awards of Long and Short Term Variable Pay in
Respect of Performance 2025
With the close of the year, the Committee reflected
on the outcomes under the Society’s 2025 SVPA and
concluded that there was no requirement to apply
any upward or downward discretion. After
considering the financial, non-financial and personal
performance, incentive payments awarded were
between 38.54% and 40.78% of salary, where the
maximum potential bonus under the scheme is 50%
of salary.
In arriving at the decision on the Society’s 2025
SVPA awards, a risk assessment process was
undertaken, during which the Committee considered
a range of factors and input from the Board Risk
Committee. The Committee decided that no risk
adjustments were required.
Performance & Strategy Governance
Financial Statements
Other Information
Skipton Group Annual Report & Accounts 2025 104
The Directors’ Remuneration Report and
Remuneration Policy for the year ended 31
December 2024 received strong member support,
both receiving 92% of votes cast in favour at the
AGM held in April 2025. Taking this outcome into
account and having assessed individual conduct and
performance, together with the Society’s overall
performance in 2024, the first LTIP grant, equivalent
to a maximum potential value of 75% of annual
salary was awarded to the executive directors and
selected colleagues of the Group Executive
Committee. These awards will be confirmed on the
third anniversary of grant, subject to meeting
performance conditions measured over a three-year
period ending on 31 December 2027. Any vested
awards at the end of the performance period will be
disclosed in the 2027 Directors’ Remuneration
Report.
Remuneration regulations
The final policy position on the changes to the PRA
regulation reforms was confirmed in October
2025. This included the simplification and reduction
in the deferral time horizons for variable pay. The
Committee remains committed to ensuring our
reward approach remains fit for purpose and aligned
with both the evolving regulatory landscape, the
Group's pay policy and member interests. Whilst
there will be an ongoing review of the application on
practices under the updated regulations, the
Committee has agreed that at present there will be
no changes made to the payment scheduling of any
historical bonus awards. Any awards made to the
executive directors in respect of the 2025
performance year and onwards will be paid in
accordance with the regulations. For further details
see page 110.
2026 look forward
Looking ahead to 2026, the Committee will continue
to review the LTIP to ensure alignment with our
strategy and member interests. As outlined on pages
115 and 116, executive directors and selected Group
Executive colleagues will participate in the following
variable pay schemes for 2026:
•Senior Variable Pay Arrangement (SVPA) maximum
award up to 50% of salary.
•Long term Incentive Plan (LTIP) maximum award
up to 75% of salary.
In the context of the wider workforce the Committee
approved a salary increase of 3% for the Group Chief
Executive Officer and Group Chief Financial Officer,
effective 1 January 2026. The Chair and non-
executive directors of the Society received a fee
increase of 4%, effective 1 January 2026, the
average increase received by the wider colleague
population was 4.48%.
Conclusion
On behalf of the Committee, I hope this report gives
you a clear view of how we have implemented the
Directors’ Remuneration Policy in 2025 and how we
are investing to support the Group’s ambitions and
strategic priorities set out in our Corporate Plan. The
Committee recommends that the members vote in
favour of the advisory resolution to approve the 2025
Directors’ Remuneration Report at the forthcoming
AGM.
Steven Davis
Chair of the Board Remuneration Committee
17 February 2026
S Davis
Performance & Strategy Governance
Financial Statements
Other Information
Skipton Group Annual Report & Accounts 2025 105
Summary of Remuneration Policy for Executive Directors in the Society
The complete policy is available in our Annual Report and Accounts 2024 on the Society’s website. The current
Directors’ Remuneration Policy was approved at the AGM on 28 April 2025 and in line with corporate
governance standards is expected to apply until the 2028 AGM when members will be asked to approve a
revised Policy.
The Committee is comfortable that the current policy is operating as intended and that the overall 2025
remuneration paid to executive directors as set out in the Annual Report on Remuneration, is appropriate. This
section summarises the current Directors’ Remuneration Policy. The table below outlines the key elements of
remuneration for executive directors, the operation and opportunity and the criteria for 2026.
Element of
remuneration
Operation and opportunity
Implementation
Base salary
Base salary is typically reviewed annually, and any increases are
effective from 1 January.
Salaries are set taking into account the size of the role and
responsibilities, and the skills and experience of the individual
as well as the individual's performance. Pay levels in
comparable organisations are also considered.
As set out in the Chair’s letter, the
Committee determined base
salaries for 2026 as follows:
• S Haire £761,302
• P Chambers £456,187
Pension Executive directors receive a contribution and / or cash
allowance to a defined contribution pension scheme. The
pension allowance rate for executive directors is aligned with
the maximum rate available to all other colleagues (currently
10% of base salary).
No change for 2026
Benefits Benefits provided to executive directors include a car or car
allowance, accommodation, private medical insurance, health
assessment, life insurance and group income protection benefits.
The Society bears the cost of providing benefits, which may vary
from year to year. The maximum potential value will depend on the
type of benefit and cost of providing it, which will vary according to
market rates.
No change for 2026
Annual bonus
SVPA (Senior
Variable Pay
Arrangement)
Performance is assessed against a balanced scorecard of measures
to determine the amount of the award for any particular year.
The maximum incentive which may be earned for any year under the
SVPA is 50% of base salary.
For awards made in respect of
2026 the target opportunity will be
30% of base salary, with a maximum
opportunity of 50% of base salary.
70% of the awards are based on
financial and non-financial
measures, with 30% of the award
based on individual performance
(including conduct and behaviours).
See page 109 for further details.
LTIP (Long-
Term Incentive
Plan)
Long term awards incentivise executive directors to deliver on
the long-term strategy of the Group over a three-year period,
thereby contributing to the long-term stability of Skipton and
creating value for the Society and its members.
The maximum potential opportunity under the LTIP is 75% of
base salary. On-target performance generally attracts an
incentive of 60% of the maximum.
Subject to the achievement of
satisfactory Society and
individual performance over the
2025 year, it is intended that LTIP
awards will be made at the
maximum potential opportunity.
See page 108 for further details.
Non-Executives Fees are typically reviewed annually. Non-executive directors do not
receive any benefits or variable pay. Travel and subsistence
expenses, including between home and Skipton offices, are
reimbursed and any tax that arises on those expenses is settled by
the Society. Fees are determined based on responsibilities, time
commitment and fees in comparable organisations.
The annual review of non-
executive director fees for 2026
has been undertaken and fees
adjusted by 4% with effect from 1
January 2026.
Performance & Strategy Governance
Financial Statements
Other Information
Skipton Group Annual Report & Accounts 2025 106
The Annual Report on Remuneration explains how we applied our existing remuneration policy in 2025 and
how we intend to implement the policy in 2026. The Committee is comfortable that the current policy operated
as intended and that the overall 2025 remuneration paid to executive directors, as set out below, is
appropriate.
Key metrics for Remuneration in the SVPA for 2025
The Strategic Report provides a comprehensive explanation of the Group’s purpose and strategy. To keep us
focused on delivering our strategy we have three key priorities:
• Help more people have a home
• Make money work harder
• Make membership matter
These ensure we are driving the Group forwards and working together to deliver more for the Society’s
members. In addition, the Strategic Report explains how Environmental, Social and Corporate Governance
(ESG) are woven through the strategy. Further details on the 2025 measures for the SVPA and LTIP can be
found on pages 108 and 109.
Performance & Strategy Governance
Financial Statements
Other Information
Skipton Group Annual Report & Accounts 2025 107
Executive Directors’ Remuneration
Any amounts awarded to the executive directors relating to the first LTIP for 2025 will be disclosed in the
Annual Report and Accounts 2027.
The total remuneration of each executive director in 2025 and 2024 is set out in the single figure tables below:
2025 audited
Executive
Director
Role
Salary
£000
Benefits
(1)
£000
Pension
(2)
£000
Total fixed
remuneration
£000
SVPA
£000
Total
remuneration
£000
Stuart
Haire
Group Chief
Executive
739 37 74 850 296 1,146
Paul Chambers
Group Chief
Financial
Officer
443 21 44 508 171 679
Andrew
Bottomley
(3)
CEO, Money 190 9 26 225 35 260
Total
Remuneration
1,372 67 144 1,583 502 2,085
Executive
Director
Role
Salary
£000
Benefits
(1)
£000
Pension
£000
Total fixed
remuneration
£000
SVPA
£000
Other
£000
Total
remuneration
£000
Stuart
Haire
Group Chief
Executive
718 39 72 829 282 - 1,111
Paul
Chambers
(3)
Group Chief
Financial
Officer
388 17 39 444 145 145 734
Andrew
Bottomley
CEO, Money
352 17 53 422 132 - 554
Bobby
Ndawula
(4)
Group Chief
Financial
Officer
365 15 37 417 66 - 483
Total
Remuneration
1,823 88 201 2,112 625 145 2,882
Notes
1. Includes all taxable benefits (private medical insurance, car allowance, health assessment, life assurance, group income protection
and travel and accommodation).
2. Current executive directors receive 10% of base salary paid into the pension scheme up to the tax approved pension limits with any
balance paid to them.
3. Andrew Bottomley’s employment with the Society ended on 30 June 2025. Andrew also received 15% of base salary (excluding any
unused holiday pay accrued, totalling £13,536) paid into the pension scheme during this period. The amount awarded to him under
the SVPA takes into consideration the period in office from 1 January to 31 March 2025.
2024 audited
Notes
1. Includes all taxable benefits (private medical insurance, car allowance, health assessment, life assurance, group income protection
and travel and accommodation).
2. Current executive directors receive 10% of base salary paid into the pension scheme up to the tax approved pension limits with any
balance paid to them, with the exception of Andrew Bottomley who received 15%.
3. Paul Chambers started his employment with the Society on 6 February 2024. Whilst we stated in the 2024 report that Paul would
receive a lost opportunity award of £250,000, the Society actually paid him £145,000 for his forfeited performance year 2023 bonus.
4. Bobby Ndawula’s employment with the Society ended on 22 November 2024. The amount awarded to him under the SVPA takes into
consideration the period in office from 1 January to 31 May 2024. His garden leave commenced on 1 June 2024.
Performance & Strategy Governance
Financial Statements
Other Information
Skipton Group Annual Report & Accounts 2025 108
Base salary and fees
Pay awards of 3% were awarded to the executive directors as part of the Society pay review effective 1 January
2025.
Notes
1. Paul Chambers joined on 6 February 2024 and the salary stated in 2024 is effective from that date.
2. Andrew Bottomley retired from the Society on 30 June 2025 and therefore did not receive a pay increase in 2025.
Executive Director
Role % increase January 2025 January 2024
Stuart Haire
Group Chief Executive Officer
3.00% £739,128 £717,600
Paul Chambers
(1)
Group Chief Financial Officer
3.00% £442,900 £430,000
Andrew Bottomley
(2)
CEO, Money
- £ 351,942 £351,942
Variable Pay: Long-term Incentive Plan (LTIP)
The Directors’ Remuneration Report and Remuneration Policy for the year ended 31 December 2024 received
strong member support, ranging between 92-93% of votes cast in favour at the AGM held in April 2025. Taking
this outcome into account, and having assessed individual conduct and performance together with the
Society’s overall performance in 2024, the first LTIP grant* equivalent to a maximum potential opportunity of
75% of base salary, was awarded to colleagues of the Group Executive Committee, including the executive
directors.
The LTIP operates over a three-year forward-looking performance period commencing on 1 January 2025.
Performance will be measured against a balanced LTIP scorecard incorporating financial and non-financial
metrics aligned to the Society’s long-term goals and the Group’s strategic priorities. See the table below for
details of the 2025-2027 measures.
No LTIP payments are made straight away. Any payout will only be confirmed after conclusion of the three year
performance period and will remain subject to Committee approval. This approval includes confirmation that
performance conditions have been met and that the Society’s accounts for the year ending 31 December 2027
have been formally approved. No payout will be made if performance does not reach the required level.
Upon completion of the performance period, the Committee will assess overall outcomes against the LTIP
scorecard and will consider whether any significant conduct, risk, reputational, financial, operational, or other
matters should affect the release of awards**. This assessment will include input from the Board Risk
Committee and Board Audit Committee. The specific performance measures and the corresponding
performance outcomes will be disclosed in the relevant year’s Remuneration Report.
*Grant refers to the point at which an LTIP is formally awarded to an individual at the start of the performance period confirming the
moment the participant becomes eligible to earn an award subject to meeting the performance conditions during the full performance
period.
**Award refers to the value that becomes payable to a participant at the end of the LTIP performance period, once the Board Remuneration
Committee has confirmed the extent to which the performance conditions have been met. It represents the final, earned outcome of the
LTIP.
LTIP measures 2025-2027 Weighting
Financial
Profit: Adjusted Group PAT (£m)
40%
Growth: Growth in Mortgage Balances
30%
Non
-Financial
Uplift in Financial Advice
5%
Proportion of lending to first time buyers
5%
Society membership satisfaction score
5%
Group scope 1&2 emissions
5%
Risk Scorecard
Reduction in the number of customer complaints
5%
Overdue audit findings
5%
Performance & Strategy Governance
Financial Statements
Other Information
Skipton Group Annual Report & Accounts 2025 109
Variable pay: Senior Variable Pay Arrangement (SVPA)
The SVPA is a discretionary incentive plan designed to reward performance on an annual basis within the
context of achieving corporate goals and objectives as set out in our Corporate Plan, encouraging positive behaviours
and maintaining sustainable performance to support the achievement of strategic goals. Participation in the plan
relating to any financial year shall be at the discretion of the Board Remuneration Committee.
The table below summarises the measures, performance targets, outcomes and weightings of the 2025 SVPA.
Note
1. For bonus purposes, the Group and Society PBT figures and Society administrative expenses are adjusted as outlined in the Board
Audit Committee Report.
At the end of the year, the Committee reviewed the annual performance under the SVPA for all the executive
directors and selected Group Executive Committee members. The incentive outcomes for 2025 are based on
the performance relative to target for the SVPA measures. They also reflect the Committee’s assessment of
performance achieved against personal objectives, taking into consideration the views of the non-executive
members of the Board.
Based on this overall assessment, the outcomes for the executive directors were between 38.54% and 40.78%
of base salary reflecting the robust performance of the Group over the year.
2025
performance
measures
Performance target
range: Threshold -
Maximum
Performance
relative to Targets
Outcome
Weighting
Group Chief
Executive &
Group Chief
Financial
Officer
Weighting
other
Executive
Directors
Adjusted Group PBT
(1)
£262.9m
– £355.7m Above threshold £307.3m 17.5% 0%
Adjusted Society PBT
(
1)
£177.1m
- £239.5m Above target £228.0m 17.5% 35%
Adjusted Society
administrative
expenses
(1)
£295.8m
- £218.6m Above target £250.2m 10% 10%
Society net customer
satisfaction
82%-90% At maximum 90% 15% 15%
Colleague engagement
and culture
20-40 At maximum 42 5% 5%
ESG
– D&I Women in
Finance
46.7%-50% At target 48%
5% 5%
ESG
– D&I Ethnicity
6.4%-8% At maximum 9.2%
Personal Objective: performance has been assessed against both the delivery
of the Society performance scorecard as well as individuals’ goals, values and
Behaviours i.e. the “how” and the “what”.
30% 30%
Performance & Strategy Governance
Financial Statements
Other Information
Skipton Group Annual Report & Accounts 2025 110
Risk considerations
To ensure that rewards are based on sustainable performance, set in a multi-year period, the Board
Remuneration Committee conducts a financial sustainability review for senior schemes (SVPA and senior
leaders), one year after the original performance year. The review also considers feedback from the Board
Risk and Board Audit Committees provided as part of the annual risk assessment process. The
sustainability review conducted in February 2026 for the 2025 SVPA and senior leaders’ schemes
demonstrated that 2024 performance levels had been maintained in 2025. The Board Remuneration
Committee therefore concluded that no adjustment to the 2024 awards was required at this point in time.
The Society has a Risk Adjustment Policy which sets out its approach to ex-ante and ex-post risk
adjustment, malus and clawback. Where the Remuneration Committee determines that risk adjustment is
required, payments due from the scheme and deferred payments (if applicable) may be postponed, reduced,
or cancelled for some, or all, participants. Examples of events in which malus and clawback may be
considered but is not limited to:
• Reasonable evidence of misconduct or performance issues
• The Group suffering financial or risk related failures
• Serious operational or regulatory issues.
In certain circumstances, the business may need to apply clawback arrangements and require repayment of
an appropriate amount of variable pay relating to the event which has occurred. The timescales in which
malus and clawback applies are in line with regulatory requirements.
The Board Remuneration Committee, after consultation with the Board Risk and Board Audit Committees
and consideration of performance against risk appetites, did not make any risk adjustments for 2025.
Deferral arrangements
In line with changes to remuneration regulations, variable pay may be subject to deferral. The Committee
has determined that, executive directors whose pay exceeds the ‘de-minimis*’ limit will have a five-year
deferral period. Under this policy, 40% of the first £660,000 of variable pay will be deferred, and 60% of any
amount above that will also be deferred. Regulations further require that 50% of total variable pay is
delivered in the form of an instrument. For 2025, variable pay includes the SVPA and the first LTIP grant.
SVPA payments are split equally between cash and a share-like instrument, while LTIP awards are delivered
entirely as share-like instruments**. See table below for details of the scheduling of payments.
*In the remuneration code, “de minimis” refers to a small-value threshold below which certain regulatory pay requirements — such as
bonus deferral or payment in instruments — do not apply because the amounts are considered too low to warrant full rules.
**A share-like instrument is a non-equity instrument used by mutual building societies to mirror the risk-alignment features of shares,
linking part of variable pay to the Society’s long-term performance and members’ interests.
Performance & Strategy Governance
Financial Statements
Other Information
Payments to former directors
A payment of £123,164 was made to David Cutter in March 2025 in respect of vested deferred
payments in 2025 from the 2017, 2018, 2019, 2021 and 2022 SVPA schemes.
A payment of £28,960 was made to Ian Cornelius in March 2025 in respect of vested deferred
payments in 2025 from the 2019 and 2021 SVPA schemes.
A payment of £90,409 was made to Bobby Ndawula in March 2025 in respect of vested deferred
payments in 2025 from the 2017, 2018, 2019, 2021, 2023 and 2024 SVPA schemes.
Payments for loss of office - no such payments were made in 2025.
Skipton Group Annual Report & Accounts 2025 111
Non-Executive Directors’ remuneration
The role of the Non-Executive Remuneration Committee is to set and review non-executive director (NED) fees
(other than the Chair of the Board) for the Society and key subsidiaries across the Group, ensuring that these are
appropriate to attract high quality individuals. Members of the Committee comprise of the Chair and both
Executive Directors. Following a review by our independent remuneration advisors, and in consideration of the
external market benchmarks, the Committee awarded the Society’s Chair a fee increase of 11.5% and the Senior
Independent Director a fee increase of 10.7%. Pay awards of 3% were awarded to the non-executive directors in
line with the Society pay increase, effective from 2025.
The table below sets out the annual fees payable for all non-executive director roles in 2025.
2025 (£) 2024 (£)
Chair
290,000 260,000
Non
-Executive Directors base fee 72,100 70,000
Senior Independent Director (“SID”) fee
87,000 78,613
Chair of Board Audit and Board Risk Committees fee
25,000 25,000
Chair of Board Remuneration Committee fee
20,000 20,000
Chair of Board Nominations Committee fee
(1)
- -
Chair of Board Change Committee fee
20,000 20,000
Board Audit, Board Risk, Board Change, Workforce Engagement, and Board
Remuneration Committee membership fees
10,000 10,000
Note
1. There is no separate Nominations Committee chair fee as the Board Chair assumes this role.
The actual total fees and expenses for the non-executive directors in 2025 and 2024 are set out below.
Detailed information regarding the non-executive directors may be found in the Corporate Governance Report.
Notes
1. Expenses relate to reimbursement of travel and subsistence between home and the Skipton head office, including for attendance at
Board and Committee meetings. In addition to reimbursement for expenses, any tax that arises is settled by the Society on behalf
of the non-executive directors.
2. Mark Lund was the Senior Independent Director for the Skipton Board. He was re-appointed as Chair of Connells, following Sarah
Whitney's departure, on 1 March 2024. The annual payment of £50,000 received as Chair of Connells board is included in the table
above. Mark Lund retired from the Society’s Board on 28 April 2025 but maintains the role of Chair of the Connells board until 13
February 2026.
3. Steven Davis received a one-off fee in 2024 for additional duties carried out on behalf of the Board.
4. Hasintha Gunawickrema was appointed as a non-executive director effective 1 November 2024.
5. Philip Moore was the Chair of Connells Audit & Risk Committee, and also a non-executive director of Connells Limited, for which he
received an annual fee of £35,000, included in the table above. Philip Moore retired from the Board and Connells on 28 April 2025.
6. Sarah Whitney was Chair of Connells board until 29 February 2024, for which she received an annual fee of £50,000. The pro-rata
amount is included in the table above.
7. Graham Lindsay was appointed as the Senior Independent Director for the Skipton Board effective 19 May 2025.
2025 2024
Non
-Executive Director
Fees
£000
Taxable
expenses
(1)
£000
Total
£000
Fees
£000
Taxable
expenses
(1)
£000
Total
£000
Gwyn Burr (Chair) 290 1 291 260 3 263
Mark Lund (Deputy Chair)
(2)
49 3 52 146 6 152
Graham Lindsay (Deputy Chair)
(7)
73 4 77 - - -
Iain Cummings 117 6 123 115 6 121
Steven Davis
(3)
99 3 102 110 6 116
Hasintha Gunawickrema
(4)
79 4 83 12 1 13
Denis Hall 107 4 111 105 6 111
Heather Jackson 112 2 114 110 4 114
Philip Moore
(5)
44 2 46 133 5 138
Sarah Whitney
(6)
- - - 22 3 25
970 29 999 1,013 40 1,053
Performance & Strategy Governance
Financial Statements
Other Information
Skipton Group Annual Report & Accounts 2025 112
Remuneration in the Society
Our Reward principles and aims
Our Board Remuneration Committee does not
consult colleagues on remuneration policy for
executive directors, but it does take into
consideration remuneration arrangements for the
wider population in the Society when determining
executive remuneration. A set of fair pay principles
has been developed taking into consideration the
views of colleagues from across the Society and
these underpin the Society’s current and future
reward strategies.
The Society has wellbeing at the forefront of its
culture and continues to support colleagues
physically, mentally and financially. Our reward
platform, ‘Select’, which is used by all colleagues,
builds awareness and enables personalisation and
choice of the benefits on offer. One of the many
features is a total reward statement allowing an
individual to understand how their package is
constructed and understand the full value when all
elements of remuneration are included.
Cascade of remuneration in the Society
Key measures and targets featured in the Executive
SVPA scheme are cascaded through the incentive
schemes covering all colleagues within the Society.
This common structure helps build a shared
commitment and alignment to our purpose, vision
and strategy and provides all colleagues in the
Society with an opportunity to be rewarded in a way
that recognises our collective success.
All employees of the Society receive base pay, are
eligible for participation in a bonus scheme and
benefits package including pension, life cover, group-
income protection, private medical and company
sick pay consistent with market practice. In addition
to this the executive committee members also
receive an annual health check.
During 2025 Colleagues have been able to use our
recently developed Reward Hub providing clear,
accessible information about how pay works at
Skipton. All employees are eligible to participate in
the appropriate incentive arrangements relevant to
their role. Members of the Group Executive
Committee and other selected senior managers may
be eligible to participate in the SVPA and LTIP on the
same terms as the executive directors, subject to the
discretion of the Group Chief Executive and the
Committee. The award size for these individuals may
be lower than for the executive directors.
A variable pay arrangement for all colleagues
(excluding those in the SVPA) is in place, so that
everyone employed by the Society will have the
opportunity to share in the Society’s success. The
key measures for the scheme are aligned with those
that apply for senior management.
How does executive remuneration for 2025 align with the wider organisation?
Average pay increase
Year-on-
year
change
Average bonus award
Year
-on-
year
change
1 Jan 2025 1 Jan 2024 2025 2024
Group Chief Executive
3.00% 4.00% -1.00% 40.04% 39.30% +0.74%
Executive Directors
3.00% 4.00% -1.00% 39.66% 37.40% +2.26%
Other Society
Executive Committee
members
6.25% 4.40% +1.85% 41.99% 34.80% +7.19%
Senior leaders
3.00% 5.15% -2.15% 21.99% 19.90% +2.09%
Other colleagues
3.15% 5.02% -1.87% 10.37% 9.20% +1.17%
Whilst the key focus of the Board Remuneration Committee is remuneration for the Group Executive
Committee, we also monitor how executive remuneration aligns with the wider Society colleague population.
The table below gives a snapshot of average pay increases and bonus awards for all colleagues in 2025.
The pay increase agreed for all colleagues in the Society was 3%, effective 1st January 2025. The Society also
provided an enhanced increase for those below the Real Living Wage. Market Adjustments were made to other
Group Executive Committee members in 2025 to ensure salaries were aligned with the market.
Performance & Strategy Governance
Financial Statements
Other Information
Skipton Group Annual Report & Accounts 2025 113
CEO pay ratio
In line with the regulatory requirements of listed companies, the Board has agreed to voluntarily publish the
CEO pay ratio for the Society only. Given the diversity of the wider Skipton Group, the Society measure is
deemed to be more appropriate as it provides a more meaningful comparison with our peers in financial
services.
For the purposes of this year’s disclosure, the pay ratio calculation uses the Society’s April 2025 gender pay
gap data to identify the three appropriate colleagues for comparison with the CEO. This methodology is
referred to as ‘Option B’. This data is used to identify the best equivalent for three colleagues whose hourly
rates of pay are at the 25
th
, 50
th
and 75
th
percentiles for the Society and their total pay and benefits figure for
2025 is then calculated. A sample of colleagues with hourly pay rates either side of the initially identified
individuals are also reviewed to ensure that the appropriate representative colleagues are selected.
The table below sets out the total remuneration of the Group Chief Executive and the total remuneration of
employees who sit at the 25th, 50th and 75th percentiles for the Society.
Notes
1. As recognised by the BEIS, those companies with multiple subsidiaries and payrolls can opt to use Option B.
2. Ratio 1 includes a buy-out awarded to the incoming Group Chief Executive.
3. Ratio 2 excludes a buy-out awarded to the incoming Group Chief Executive.
4. The 2024 pay ratio figure was erroneous and has been re-stated in the table above.
The total remuneration and salary values for the 25
th
, 50
th
(median) and 75
th
percentile employees in 2025 are:
Year
Method
(1)
25
th
percentile
pay ratio
Median
pay ratio
75
th
percentile
pay ratio
2021 Ratio
Option B 54:1 38:1 22:1
2022 Ratio 1
(2)
Option B 74:1 55:1 39:1
2022 Ratio 2
(3)
Option B 29:1 21:1 15:1
2023 Ratio
Option B 35:1 27:1 19:1
2024 Ratio
(4)
Option B 39:1 28:1 20:1
2025 Ratio
Option B 38:1 26:1 16:1
Gender pay data
25
th
percentile
pay ratio
Median
pay ratio
75
th
percentile
pay ratio
Salary (£)
26,824 38,485 65,600
Total remuneration (£)
29,568 42,710 72,310
The CEO pay ratio for 2025 remains below that observed across comparable organisations within our peer
group. Reflecting the diverse range of roles within the Society, the Committee considers the ratios to be
appropriate and aligned with the Society’s established reward framework. The Committee is satisfied that
they provide a reasonable representation of the Society’s overall approach to colleague pay and reward.
Performance & Strategy Governance
Financial Statements
Other Information
Skipton Group Annual Report & Accounts 2025 114
Relative importance of spend on pay
The following table sets out the changes in Society profit after tax in 2025 and 2024 and compares these with
the overall spend of remuneration over the two years. As a mutual organisation, the Society only seeks to
retain sufficient profit to maintain capital ratios and support investment in the business, with any surplus
above this returned to members through competitive pricing.
The spend in the year reflects further investments in our people. Total employee remuneration across the
Society has increased 15.1% on last year, through a combination of higher pay awards and rising headcount
as we continue our focus on providing high levels of customer satisfaction.
The Financial Review (within the Strategic Report) provides an overview of financial performance for the year.
Material Risk Takers (MRT)
Material risk takers are those colleagues whose professional activities have a material impact on the Society
and Group subsidiaries risk profile. In accordance with regulations, we have identified MRTs in the Society and
in the Group subsidiary companies who are in scope of the PRA and FCA regulations.
The Board Remuneration Committee is responsible for approving remuneration policies, maintaining oversight
of the remuneration of MRTs and for ensuring that remuneration is paid to them in accordance with regulatory
requirements.
Details of the MRTs’ remuneration arrangements for 2025 are included in the Pillar 3 document which is
available on our website.
CEO Pay comparative over the past five years
The table below shows details of the total remuneration and the amount vesting under short-term incentives
as a percentage of the maximum that could have been achieved, in respect of the Group Chief Executive
Officer role for the previous five years.
Year
Single figure of total remuneration £000
Annual bonus earned against
maximum opportunity
2025
1,146 80.1%
2024
1,111 78.6%
2023
1,034 67.6%
2022
(1)
1,151 -
2021
(2)
1,309 100.0%
Notes
1. Stuart Haire commenced his role as Group Chief Executive Officer on 31 December 2022. As a result of his resignation from
HSBC, Stuart has forfeited deferred awards made to him in respect of financial years prior to 2022, as well as the opportunity
to earn a bonus for 2022. The figure in the table therefore includes an award of £345,000 to replace the forfeited bonus
opportunity.
2. The Group Chief Executive Officer in 2021 was David Cutter. The Committee made the decision to exercise its discretion by
awarding 100% of salary under the Society’s SVPA scheme due to the transformative impact of the Countrywide acquisition
and the contribution of the Group Chief Executive to the success of the transaction.
Performance & Strategy Governance
Financial Statements
Other Information
2025 £m 2024 £m Change %
Total assets
38,326.9 36,628.3 4.6%
Total employee remuneration
costs paid
152.8 132.8 15.1%
Profit after tax
222.6 189.2 17.7%
Skipton Group Annual Report & Accounts 2025 115
Base salary
The Committee approved a pay award of 3% for the
executive directors which will be effective from 1
January 2026. The average increase across the
wider workforce is 4.48%.
Effective 1 January 2026, the increase in fees for the
Chair and non-executive directors was 4%.
There are no changes to the Society's approach to
benefits and pensions.
Senior Variable Pay Arrangement (SVPA)
The maximum bonus opportunity will remain 50% of
base salary, with the target opportunity 30% of base
salary. Malus and clawback provisions apply.
The performance measures included in the SVPA
have been reviewed for 2026 to maintain a clear link
between the bonus plan and how it supports and re-
enforces business strategy. The measures and
weightings for the 2026 SVPA are set out in the table
below. The targets set and the extent of their
achievement will be disclosed in the 2026 Annual
Report as the Board Remuneration Committee
considers them to be commercially sensitive at this
point in time.
2026 performance measures Group CEO
Group CFO
Financial
Adjusted Group PBT*
17.5% 17.5%
Adjusted Society PBT*
17.5% 17.5%
Adjusted Society administrative expenses*
10.0% 10.0%
Financial: total weighting
45.0% 45.0%
Customer & Colleague
Society net customer satisfaction
15.0% 15.0%
Execution of the 2026 talent, capability, culture and
curiosity agenda to support future business growth
5.0% 5.0%
Customer & colleague: total weighting
20.0% 20.0%
ESG
Diversity & Inclusion
5.0% 5.0%
ESG: total weighting
5.0% 5.0%
Personal objectives
Personal objective / performance
– what? 15.0% 15.0%
Personal objective / performance
– how? 15.0% 15.0%
Personal objectives: total weighting
30.0% 30.0%
Statement of implementation of Remuneration Policy in 2026
* For bonus purposes, the Group and Society profit and Society administrative expenses are adjusted for those items that are not
considered part of the Group’s core strategy, to give greater transparency of the performance of ongoing trading activities - as defined
within the Strategic Report; or for those items that are outside of the directors’ control. This is reviewed and approved by the Board Audit
Committee.
Long-term Incentive Plan (LTIP)
LTIP awards in respect of the 2026-2028 performance period will be granted during 2026. LTIP awards are
discretionary and are made subject to a pre-grant performance assessment over the prior year. The
maximum opportunity will remain at 75% of base salary, with the target opportunity around 60% of the
maximum. Deferral, malus and clawback provisions will apply.
The Committee reviewed the performance measures and concluded that no changes were required for
2026 (see page 108 for further details). The selected measures remain aligned to the Group’s long-term
priorities, supporting sustainable performance and ensuring continued alignment with the business
strategy and member interests. Full details of the applicable performance metrics will be disclosed in the
Directors’ Remuneration Report for the relevant vesting year.
Performance & Strategy Governance
Financial Statements
Other Information
Skipton Group Annual Report & Accounts 2025 116
Potential remuneration based on performance
The charts below set out the potential value each of the executive directors could earn under the directors’
remuneration policy, in different performance scenarios using an LTIP grant value of 75%: Minimum (i.e. fixed
pay, pension and benefits only, zero variable pay), Target (i.e. fixed pay, pension, benefits and 50% of the
maximum variable pay that may be awarded) and Maximum (i.e. fixed pay, pension, benefits and the maximum
variable pay that may be awarded).
The Committee is committed to keeping LTIP grant levels fixed unless a review during the three-year policy
determines that an adjustment is necessary, therefore the potential value illustrated may be subject to change
but will not exceed the maximum values set out within the directors’ remuneration policy.
A significant proportion of the potential remuneration of the executive directors is payable based on the
achievement of stretching performance measures and subject to deferral, malus and clawback. No payments
relating to LTIP awards will be made until after the end of the forward-looking three-year performance period
and Board approval of the accounts relating to these years.
761
761
761
114
114
114
228
381
343
571
£0k £500k £1000k £1500k £2000k
Minimum
Target
Maximum
£875k
£1,446k
£1,827k
456
456
456
67
67
67
137
228
205
342
£0k £500k £1000k £1500k £2000k
Minimum
Target
Maximum
Salary Pension & Benefits SVPA LTIP
£523k
£865k
£1,093k
Paul Chambers
Group Chief Financial Officer
Stuart Haire
Group Chief Executive Officer
Performance & Strategy Governance
Financial Statements
Other Information
Skipton Group Annual Report & Accounts 2025 117
Independent advisers
PwC were appointed as independent external consultants by the Committee in 2015 following a review of
potential advisers. PwC is a signatory to the voluntary Code of Conduct in relation to remuneration in the UK.
During the year, PwC have supported the Committee on a range of items advising on regulatory reporting and
risk adjustment, carrying out the non-executive directors benchmarking exercise, advising on the design and
implementation of the Long-Term Incentive Plan and executive director remuneration. The Committee is
satisfied that the advice received is objective and independent. PwC’s fees in respect of remuneration services
provided in 2025 were £119,077 (net of VAT).
In addition to remuneration, PwC provide other services to the Society such as accounting, internal audit, and
tax advice.
The Committee has undertaken a review of its independent external advisory support and confirms that
Deloitte will be appointed as the new independent external consultants to the Board Remuneration Committee,
effective from March 2026.
Statement of voting at the 2025 AGM
The Committee has, for a number of years, invited members to vote (on an advisory basis) on the
Remuneration Policy every 3 years and annual Remuneration Report every year, and takes member feedback
into account when determining policy and outcomes.
Our Directors’ Remuneration Report for the year ended 31 December 2024 received strong support at the AGM
held in April 2025, the results of which were as follows:
We will be seeking an advisory vote on the Directors’ Remuneration Report for the year ended 31 December
2025 at the AGM to be held in April 2026.
I would like to thank members for their ongoing support and encourage you to vote in favour of the Directors’
Remuneration Report.
Steven Davis
Chair of the Board Remuneration Committee
17 February 2026
Votes For Votes Against
Votes
Withheld
55,100 (92.84%) 4,250 (7.16%) 1,294
S Davis
Performance & Strategy Governance
Financial Statements
Other Information
Skipton Group Annual Report & Accounts 2025 120
Opinion
In our opinion:
• the Group financial statements and the Society’s financial statements (the “financial statements”) give a
true and fair view of the state of the Group’s and the Society’s affairs as at 31 December 2025 and of the
Group’s and the Society’s income and expenditure for the year then ended;
• the financial statements have been properly prepared in accordance with UK adopted international
accounting standards; and
• the financial statements have been prepared in accordance with the requirements of the Building
Societies Act 1986.
We have audited the financial statements of Skipton Building Society (the ‘Society’) and its subsidiaries
(together, the ‘Group’) for the year ended 31 December 2025 which comprise:
Group
Society
Consolidated Income Statement for the year ended 31
December 2025
Income Statement for the year ended 31 December
2025
Consolidated Statement of Comprehensive Income for
the year ended 31 December 2025
Statement of Comprehensive Income for the year
ended 31 December 2025
Consolidated Statement of Financial Position as at 31
December 2025
Statement of Financial Position as at 31 December
2025
Consolidated Statement of Changes in Member
Interests for the year ended 31 December 2025
Statement of Changes in Member Interests for the
year ended 31 December 2025
Consolidated Statement of Cash Flows for the year
ended 31 December 2025
Statement of Cash Flows for the year ended 31
December 2025
Related notes 1 to 50 to the financial statements,
including material accounting policy information
Related notes 1 to 50 to the financial statements
including material accounting policy information
Information in respect of Country by Country Reporting on pages 288 to 289
Information
in the Annual Business Statement described as forming part of the audited Accounts on page
290
Information identified as “audited” within the Directors’ Remuneration Report
The financial reporting framework that has been applied in their preparation is applicable law and UK adopted
international accounting standards.
Basis for opinion
We conducted our audit in accordance with International Standards on Auditing (UK) (ISAs (UK)) and
applicable law. Our responsibilities under those standards are further described in the Auditor’s responsibilities
for the audit of the financial statements section of our report. We believe that the audit evidence we have
obtained is sufficient and appropriate to provide a basis for our opinion.
Independence
We are independent of the Group and the Society in accordance with the ethical requirements that are relevant
to our audit of the financial statements in the UK, including the FRC’s Ethical Standard as applied to public
interest entities, and we have fulfilled our other ethical responsibilities in accordance with these requirements.
The non-audit services prohibited by the FRC’s Ethical Standard were not provided to the Group or the Society
and we remain independent of the Group and the Society in conducting the audit.
Performance & Strategy Governance
Financial Statements
Other Information
Skipton Group Annual Report & Accounts 2025 121
Conclusions relating to going concern
In auditing the financial statements, we have
concluded that the Directors’ use of the going
concern basis of accounting in the preparation of the
financial statements is appropriate. Our evaluation
of the Directors’ assessment of the Group and
Society’s ability to continue to adopt the going
concern basis of accounting included the following
procedures:
• We obtained the Directors’ going concern
assessment, including the cash flow forecasts for
the going concern period covering the 12 months
from the date of signing this audit opinion.
• We compared the budgeted financial information
with historical actual results, in order to form a
view on the reliability of the forecasting process.
• We assessed the results of the Directors’ stress
testing including consideration of principal and
emerging risks, on funding, liquidity and
regulatory capital.
• We considered whether there were other events
subsequent to the balance sheet date which
could have a bearing on the going concern
conclusion.
• We reviewed regulatory correspondence and
committee and board meeting minutes to identify
events or conditions that may impact the Group
and Society’s ability to continue as a going
concern.
• We reviewed the Group and Society’s going
concern disclosures included in the annual report
in order to assess that the disclosures were
appropriate and in conformity with the reporting
standards.
Based on the work we have performed, we have not
identified any material uncertainties relating to
events or conditions that, individually or collectively,
may cast significant doubt on the Group and
Society’s ability to continue as a going concern for a
period of 12 months from when the financial
statements are authorised for issue.
In relation to the Group and Society’s reporting on
how they have applied the UK Corporate Governance
Code, we have nothing material to add or draw
attention to in relation to the Directors’ statement in
the financial statements about whether the Directors
considered it appropriate to adopt the going concern
basis of accounting.
Our responsibilities and the responsibilities of the
Directors with respect to going concern are
described in the relevant sections of this report.
However, because not all future events or conditions
can be predicted, this statement is not a guarantee
as to the Group and Society’s ability to continue as a
going concern.
Audit
scope
•
We performed an audit of the complete financial information of two full scope components,
audit procedures on specific balances for a further five specific scope components.
•
We performed centralised procedures on financial control and reporting, derivative financial
instruments and hedge accounting, defined benefit pension schemes, information
technology and taxation.
Key audit
matters
• Measurement of loan impairment relating to retail and commercial mortgages
• Fair value of the equity release portfolio
• Revenue recognition in respect of estate agency income
Materiality
• Overall Group materiality of £14.6m which represents 5% of PBT, adjusted for non-recurring
items.
Overview of our audit approach
An overview of the scope of the Society and the Group audits
Tailoring the scope
In the current year our audit scoping has been updated to reflect the new requirements of ISA (UK) 600
(Revised). We have followed a risk-based approach when developing our audit approach to obtain sufficient
appropriate audit evidence on which to base our audit opinion. We performed risk assessment procedures,
with input from our component auditors, to identify and assess risks of material misstatement of the Group
financial statements and identified significant accounts and disclosures. When identifying components at
which audit work needed to be performed to respond to the identified risks of material misstatement of the
Group financial statements, we considered our understanding of the Group and its business environment, the
potential impact of climate change, the applicable financial framework, the Group’s system of internal control
at the entity level, the existence of centralised processes, applications and any relevant internal audit results.
Performance & Strategy Governance
Financial Statements
Other Information
Skipton Group Annual Report & Accounts 2025 122
Component
Scope
Key locations
Skipton Building Society
Full
United Kingdom
Connells Limited
Full
United Kingdom
Skipton International Limited
Specific
Channel Islands
Skipton Business Finance Limited
Specific
United Kingdom
Skipton Covered Bonds Limited Liability
Partnership
Specific
United Kingdom
Darrowby No.6 PLC
Specific
United Kingdom
Jade Software Corporation Limited
Specific
New Zealand, United Kingdom
The scoping for the current year is as follows:
We determined that centralised audit procedures can be performed across the identified components in the
following key audit areas:
Significant audit area on which procedures were performed
centrally
Component subject to central procedures
Financial control and reporting
All components
Derivative financial instruments and hedge accounting
All relevant components (Skipton Building
Society, Skipton International Limited,
Skipton Covered Bonds Limited Liability
Partnership, Darrowby No.6 PLC)
Defined benefit pension schemes
Skipton Building Society and Connells
Limited (for one scheme held within the
Connells Limited component)
Information technology
All components except Connells Limited,
Skipton International Limited, Jade
Software Corporation Limited
Taxation
All components except Skipton
International Limited
Fees and commissions receivable and Administrative
expenses
Jade Software Corporation Limited
Performance & Strategy Governance
Financial Statements
Other Information
We identified two components as individually relevant
to the Group due the identified risks of material
misstatement of the Group financial statements being
associated with the reporting components and the
financial size of the component relative to the Group.
For those individually relevant components, we
identified the significant accounts where audit work
needed to be performed at these components by
applying professional judgement, having considered
the Group significant accounts on which centralised
procedures will be performed, the reasons for
identifying the financial reporting component as an
individually relevant component and the size of the
component’s account balance relative to the Group
significant financial statement account balance.
We then considered whether the remaining Group
significant account balances not yet subject to audit
procedures, in aggregate, could give rise to a risk of
material misstatement of the Group financial
statements. We selected seven components of the
Group to include in our audit scope to address these
risks.
Having identified the components for which work will
be performed, we determined the scope to assign to
each component.
Of the seven components selected, we designed and
performed audit procedures on the entire financial
information of two components (“full scope
components”). For the remaining five components, we
designed and performed audit procedures on specific
significant financial statement account balances or
disclosures of the financial information of the
component (“specific scope components”).
Skipton Group Annual Report & Accounts 2025 123
The key audit matters related to full scope
components. The audit procedures in respect of the
following key audit matters were performed by the
Group audit team:
• Measurement of loan impairment relating to retail
and commercial mortgages; and
• Fair value of the equity release portfolio.
Audit procedures over the following key audit
matters were performed by the Connells Limited
component audit team:
• Revenue recognition in respect of estate agency
income.
The Group audit team’s involvement with the
Connells Limited component team and procedures
performed included:
• Risk assessment procedures and determining the
type and extent of work to be undertaken at each
of the components;
• Regular interactions throughout the course of the
audit, including planning meetings, maintaining
regular communications on the status of the audit
work, and meetings on results and conclusions;
• Undertaking component site visits over the
course of the audit; and
• Reviewing key working papers and taking
responsibility for the scope and direction of the
audit process.
Involvement with component teams
In establishing our overall approach to the Group
audit, we determined the type of work that needed to
be undertaken at each of the components by us, as
the Group audit engagement team, or by component
auditors operating under our instruction.
The Group audit team followed a programme of
planned visits that has been designed to ensure that
the Senior Statutory Auditor visited component
teams and held meetings with them to discuss the
audit approach and any issues arising from their
work. During the current year’s audit cycle, visits
were undertaken by the Group audit team to the
component teams in the Channel Islands and United
Kingdom, as well as a schedule of planned meetings
held remotely. This schedule involved meeting with
local management, attending planning and closing
meetings, and reviewing relevant audit working
papers on risk areas. The Group audit team
interacted regularly with the component teams
during various stages of the audit, reviewed relevant
working papers and were responsible for the scope
and direction of the audit process. Where relevant,
the section on key audit matters details the level of
involvement we had with component auditors to
enable us to determine that sufficient audit evidence
had been obtained as a basis for our opinion on the
Group as a whole.
This, together with the additional procedures
performed at Group level, gave us appropriate
evidence for our opinion on the Group financial
statements.
Climate change
Stakeholders are increasingly interested in how
climate change will impact Skipton Building Society.
The Group and the Society has determined that the
most significant future impacts from climate change
on their operations will be from physical and
transitional risks. These are explained on pages 31
to 34 in the Strategic Report. The Group and Society
have also explained their climate commitments on
page 34 of that report. All of these disclosures form
part of the “Other information,” rather than the
audited financial statements. Our procedures on
these unaudited disclosures therefore consisted
solely of considering whether they are materially
inconsistent with the financial statements or our
knowledge obtained in the course of the audit or
otherwise appear to be materially misstated, in line
with our responsibilities on “Other information”.
In planning and performing our audit we assessed
the potential impacts of climate change on the
Group and Society’s business and any consequential
material impact on its financial statements.
The Group and Society have explained in Note 1 to
the Annual Report and Accounts how they have
reflected the impact of climate change in their
financial statements including how this aligns with
their commitment to long-term net zero targets.
Significant judgements and estimates relating to
climate change are included in Note 1 and Note 45.
These disclosures also explain where governmental
and societal responses to climate change risks are
still developing, and where the degree of certainty of
these changes means that they cannot be taken into
account when determining asset and liability
valuations under the requirements of UK adopted
international accounting standards.
Our audit effort in considering the impact of climate
change on the financial statements was focused on
evaluating Directors’ assessment of the impact of
climate risk, physical and transitional, the Group’s
climate commitments, the effects of material climate
risks and the significant judgements and estimates
disclosed in Note 1 and whether these have been
appropriately reflected in asset values where these
are impacted by future cash flows and associated
sensitivity disclosures, and in the timing and nature
of liabilities recognised, following the requirements
of UK adopted international accounting standards.
Performance & Strategy Governance
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Other Information
Skipton Group Annual Report & Accounts 2025 124
As part of this evaluation, we performed our own risk
assessment, supported by our climate change
internal specialists, to determine the risks of material
misstatement in the financial statements from
climate change which needed to be considered in
our audit.
We also challenged the Directors’ considerations of
climate change in their assessment of going concern
and viability and associated disclosures.
Based on our work, whilst we have not identified the
impact of climate change on the financial
statements to be a standalone key audit matter, we
have considered the impact on the following key
audit matter: Measurement of loan impairments
relating to retail and commercial mortgages. Details
of the impact, our procedures and findings are
included in our explanation of key audit matters
below.
Key audit matters
Key audit matters are those matters that, in our
professional judgment, were of most significance in
our audit of the financial statements of the current
period and include the most significant assessed
risks of material misstatement (whether or not due
to fraud) that we identified. These matters included
those which had the greatest effect on the overall
audit strategy, the allocation of resources in the
audit; and directing the efforts of the engagement
team. These matters were addressed in the context
of our audit of the financial statements as a whole,
and in our opinion thereon, and we do not provide a
separate opinion on these matters.
The following risks have been identified as key audit
matters.
Measurement of loan impairments relating to retail and commercial mortgages
Risk
(Group
– 31 December 2025 £25.6m, 31 December 2024 £19.6m;
Society
– 31 December 2025 £23.5m, 31 December 2024 £17.5m)
The measurement of the loan impairment provision under IFRS 9 is subjective and requires the Directors to
exercise judgement with regards to estimating future losses that the Society may incur within the retail and
commercial mortgage books. This calculation is complex and subjective due to the high uncertainty
associated with the assumptions used. This includes the impacts of the continuing uncertain geopolitical
and economic outlook. As a result, there is a need for the Directors to exercise judgement and perform
assessments to consider whether these risks are appropriately captured through models or should be
captured through the recording of post model adjustments.
Key judgements and estimates include:
• The application of multiple economic scenarios, including the appropriate weightings for the various
scenarios.
• Completeness and valuation of post-model adjustments.
• Identifying assets that have experienced a significant increase in credit risk (SICR) since origination
(stage 2) and those that are credit impaired (stage 3).
• Accounting interpretations, collateral valuations and modelling assumptions used to build the models
and calculate the ECL.
Due to the degree of judgement that needs to be exercised by the Directors around the key assumptions into
the Society’s ECL model as well as the complexity of the calculation, this was considered a key audit matter.
Performance & Strategy Governance
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Other Information
Skipton Group Annual Report & Accounts 2025 125
Measurement of loan impairments relating to retail and commercial mortgages (continued)
Our response to the risk
We gained an understanding of the Society’s processes, controls and assumptions used in the impairment
process in order to evaluate the compliance of the Society’s methodology with the requirements of IFRS 9.
Our substantive audit procedures over the residential and commercial IFRS 9 provision models included
assessing the appropriateness of model design and the calculations used, challenging and substantiating
key assumptions, such as: loss given default (LGD), significant increases in credit risk (SICR) and the staging
applied, forward looking assumptions, and the determination of lifetime PDs.
We tested the assumptions, inputs and model calculations used in a risk
-based sample of ECL models with
the involvement of our internal credit modelling specialists. This included assessing the appropriateness of
the model design, model performance and ECL replication testing.
With the support from our internal valuation specialists, we independently challenged the valuation of
collaterals for a sample of commercial loans at the balance sheet date and considered assumptions about
future recoverability.
We assessed the Society’s staging criteria and independently reperformed staging on a sample of loans in
stages 1, 2 and 3 for commercial loans and on the full population of residential loans to verify whether they
were allocated appropriately, with reference to the Society’s SICR criteria.
We assessed the base case and alternative economic scenarios adopted by the Directors utilising economic
specialists. We challenged the number of scenarios used in the models, as well as the probability weightings
ascribed to those scenarios. We compared them to other scenarios from a variety of external sources, as
well as EY’s internally developed forecasts. With the assistance of economics specialists, we assessed
whether forecast macroeconomic variables were reasonably captured within the loan loss provision.
With our credit modelling specialists, we assessed the completeness and valuation of post model
adjustments using our knowledge and experience across the UK lending sector and tested material
adjustments for reasonableness of estimation with reference to observable market data.
We assessed the valuation of specific provisions held for a sample of non
-performing loans. We also
assessed a sample of individual loans classified as performing loans, where no specific provision was held
to determine whether their stage classification was appropriate.
Our procedures included a series of “stand back” analyses, including industry benchmarking, internal
consistency checks and analytical reviews.
Key observations communicated to the Board Audit Committee
We are satisfied that the ECL provisions were reasonable and recognised in accordance with IFRS 9. We
highlighted the following matters to the Board Audit Committee that contributed to our overall conclusion:
•
Observation in respect of the controls relevant to the valuation of ECLs.
•
Results of our testing of models, model assumptions, the key data elements used for ECL calculation,
including the reasonableness of the macroeconomic variables, scenarios and weightings used.
•
Accuracy of staging and the reasonableness of management’s staging criteria, and our independent
sensitivity analysis on the staging criteria to assess appropriateness.
•
Reasonableness and adequacy of the post-model adjustments recorded to reflect risk in the portfolios.
•
Individually assessed impairments, the overall reasonableness of the provisions, including assumptions
applied.
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Other Information
Skipton Group Annual Report & Accounts 2025 126
Fair value of equity release portfolio
Risk
(Group and Society
– 31 December 2025 £263.1m, 31 December 2024 £277.2m;
Net gains / (losses) on the portfolios
– 2025 £(6.4)m, 2024 £9.3m)
The Society holds three equity release mortgage portfolios that carry a no negative equity guarantee. This
guarantee limits the Society’s maximum return to the value of the relevant customer’s property on
redemption. The Society is therefore exposed to potential losses on the portfolio, albeit any loss is limited in
part by a further guarantee provided to the Society by a third party. The Society uses equity release swaps to
economically manage the interest rate risk and reduce overall income statement volatility that would
otherwise result from changes in the fair value of the equity release mortgage portfolio.
The fair value of the equity release portfolio is determined using a complex model which uses a Monte Carlo
simulation and a number of different judgmental assumptions to derive an estimated value. Two of the
equity release swaps are also valued using a Monte Carlo based model. The key assumptions used in the
models include:
• Discount rates, including illiquidity premia.
• Mortality rates.
• Future increases in house prices (‘HPI’).
• Prepayment rates
Due to the degree of judgement that needs to be exercised by the Directors around the key assumptions into
the valuation model, and the complexity of the calculation, this was considered a key audit matter.
Our Response to the risk
We gained an understanding of the Society’s processes, controls and assumptions used in the valuation of
the equity release portfolio. We assessed the Society’s accounting policies and methodologies related to the
fair value of the equity release portfolio and the corresponding swaps for compliance with applicable
accounting standards.
With support from our valuation specialists, we assessed the appropriateness of the valuation techniques
and independently calculated a range of fair values for the equity release portfolio. We compared the
modelled fair values against this range. Our valuation specialists assessed the valuation methodologies
used in relation to the swaps, and independently calculated a range of fair values.
We challenged assumptions used in the fair value models, including the discount rate, mortality rates, future
changes in house prices and prepayment rates. We compared assumptions applied in the fair value models
to the Society’s historical experience and benchmarked assumptions to observable market data where
applicable. Where observable market data was not available we used specialist judgement and internal data
to assess the reasonableness of these assumptions.
We performed testing over the completeness and accuracy of data used in the equity release models and
underlying calculations. This involved testing a sample of key data fields used in the model to source data
and corroborative evidence.
Key observations communicated to the Board Audit Committee
We consider that the valuation of the portfolio was reasonable. We highlighted to the Board Audit
Committee the following matters which were relevant to our conclusion:
• Our observations in respect of the control environment to the valuation of the equity release portfolio.
• Reasonableness of the models used to calculate the fair value of the equity release portfolio and
associated swaps.
• Reasonableness of key assumptions deployed in the valuation of the equity release portfolio and
corresponding swap models in the context of the portfolio and current market conditions.
Performance & Strategy Governance
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Other Information
Skipton Group Annual Report & Accounts 2025 127
Revenue recognition in respect of estate agency income
Risk
(Group
– 31 December 2025 £1,171.8m, 31 December 2024 £1,056.2m)
There is a risk that management may override controls and post unusual journals outside the expected flow
of transactions in order to overstate revenue and achieve targets set within respective management
incentive schemes. This risk is specific to manual revenue journals posted during the financial year within
the estate agency revenue streams which are material to the Group.
Given the manual nature and volume of revenue transactions in the Connells Limited estate agency
component, this was considered a key audit matter.
Our Response to the risk
We gained an understanding of the Group’s processes and controls relevant to the recognition of estate
agency income. We assessed the Group’s accounting policy for estate agency income for compliance with
IFRS 15.
We performed cut
-off testing on a sample of transactions falling either side of the 31 December 2025 year
end date.
We performed data analysis procedures to assess the recognition of revenue throughout the year. We
performed testing over significant revenue streams using either data analysis tools or alternative
substantive procedures. Where we used data analysis tools, we tested the correlation of revenue to trade
receivables and cash receipts to verify the occurrence of revenue. Our alternative substantive procedures
included tracing each sampled transaction back to appropriate evidence to assess whether the revenue was
appropriately recorded in the correct period and at the correct value.
We performed testing over a sample of manual journal entries selected through a combination of risk
-
based
and random sampling techniques across these revenue streams. We substantiated these journals to
supporting documentation and validated that revenue recognition criteria had been fulfilled and that values
were materially correct.
Key observations communicated to the Board Audit Committee
We concluded that the estate agency income recognised by the Group was reasonably measured. We
communicated to the Board Audit Committee the following matters which were relevant to our conclusion:
• Our observations in respect of the control environment relevant to the recognition of estate agency
revenue.
• We identified a correlation of transactions between revenue, trade receivables and cash, evidencing the
appropriateness of the revenue recognised over the period.
•
We did not identify any evidence of material misstatements in the revenue recognised or any instances of
management override.
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Other Information
Skipton Group Annual Report & Accounts 2025 128
Our application of materiality
We apply the concept of materiality in planning and
performing the audit, in evaluating the effect of
identified misstatements on the audit and in forming
our audit opinion.
Materiality
The magnitude of an omission or misstatement that,
individually or in the aggregate, could reasonably be
expected to influence the economic decisions of the
users of the financial statements. Materiality
provides a basis for determining the nature and
extent of our audit procedures.
We determined materiality for the Group to be
£14.6m (2024: £15.9m), which is 5% of adjusted
profit before tax (2024: 5% of profit before tax). We
adjusted the Group’s pre-tax profit by excluding the
loss on disposal of the Society’s Permanent Interest-
Bearing Shares and the gain from disposal of
business assets by Connells Limited.
We determined materiality for the Society to be
£10.8m (2024: £10.8m), which is 5% of adjusted
profit before tax (2024: 5% of adjusted profit before
tax). We adjusted the Society’s pre-tax profit by
excluding dividend income from shares from
subsidiary undertakings and the loss on disposal of
the Society’s Permanent Interest-Bearing Shares.
We believe that adjusted profit before tax provides
us with an appropriate basis for materiality given the
users of the financial statements (including the
Society’s members and regulators) principally focus
on pre-tax profit in assessing the Group and
Society’s performance, and that normalising pre-tax
profit results in the most useful measure for users of
the financial statements.
Performance materiality
The application of materiality at the individual
account or balance level. It is set at an amount to
reduce to an appropriately low level the probability
that the aggregate of uncorrected and undetected
misstatements exceeds materiality.
On the basis of our risk assessments, together with
our assessment of the Group’s overall control
environment, our judgement was that performance
materiality was 75% (2024: 75%) of our planning
materiality, namely £10.9m (2024: £11.9m). We have
set performance materiality at this percentage due to
our previous experience as auditors of the Group,
from which we concluded that there is a lower
expectation of material financial statement
inaccuracies due to our assessment of the overall
entity-level controls, our testing of the operating
effectiveness of certain financial reporting control
environment, and no material audit differences
resulting from our prior and current year work.
Our approach is consistent with the prior year.
Audit work was undertaken at component locations
for the purpose of responding to the assessed risks
of material misstatement of the group financial
statements. The performance materiality set for
each component is based on the relative scale and
risk of the component to the Group as a whole and
our assessment of the risk of misstatement at that
component. In the current year, the range of
performance materiality allocated to components
was £2.1m to £8.7m (2024: £2.4m to £10.3m).
Reporting threshold
An amount below which identified misstatements
are considered as being clearly trivial.
We agreed with the Board Audit Committee that we
would report to them all uncorrected audit
differences in excess of £0.7m (2024: £0.8m), which
is set at 5% of planning materiality, as well as
differences below that threshold that, in our view,
warranted reporting on qualitative grounds
We evaluate any uncorrected misstatements against
both the quantitative measures of materiality
discussed above and in light of other relevant
qualitative considerations in forming our opinion.
Other information
The other information comprises the information
included in the annual report other than the financial
statements, information of Country by Country
Reporting, information identified as “audited” within
the Directors’ Remuneration Report, and information
in the Annual Business Statement, described as
forming part of the audited Accounts, and our
auditor’s report thereon. The Directors are
responsible for the other information contained
within the annual report.
Our opinion on the financial statements does not
cover the other information and, except to the extent
otherwise explicitly stated in this report, we do not
express any form of assurance conclusion thereon.
Our responsibility is to read the other information
and, in doing so, consider whether the other
information is materially inconsistent with the
financial statements or our knowledge obtained in
the course of the audit or otherwise appears to be
materially misstated. If we identify such material
inconsistencies or apparent material misstatements,
we are required to determine whether this gives rise
to a material misstatement in the financial
statements themselves. If, based on the work we
have performed, we conclude that there is a material
misstatement of the other information, we are
required to report that fact.
We have nothing to report in this regard.
Performance & Strategy Governance
Financial Statements
Other Information
Skipton Group Annual Report & Accounts 2025 129
Opinion on other matters prescribed by the Building
Societies Act 1986
In our opinion:
• The Annual Business Statement and the Directors’
Report have been prepared in accordance with
the requirements of the Building Societies Act
1986;
• The information given in the Directors’ Report for
the financial year for which the financial
statements are prepared is consistent with the
financial statements; and
• The information given in the Annual Business
Statement (other than the information upon which
we are not required to report) gives a true
representation of the matters in respect of which
it is given.
Matters on which we are required to report by
exception
We have nothing to report in respect of the following
matters where the Building Societies Act 1986
requires us to report to you if, in our opinion:
• Proper accounting records have not been kept by
the Group and Society; or
• The Group or Society’s
financial statements are
not in agreement with the accounting records; or
• We have not received all the information and
explanations and access to documents we
require for our audit.
Corporate Governance Statement
We have reviewed the Directors’ statement in relation
to going concern, longer-term viability and that part
of the Corporate Governance Statement relating to
the Group and Society’s voluntary compliance with
the provisions of the UK Corporate Governance Code
specified for our review by the Listing Rules.
Based on the work undertaken as part of our audit,
we have concluded that each of the following
elements of the Corporate Governance Statement
are materially consistent with the financial
statements or our knowledge obtained during the
audit:
• The Directors’ statement with regards to the
appropriateness of adopting the going concern
basis of accounting and any material
uncertainties identified set out on pages 66 and
67;
• The Directors’ explanation as to its assessment of
the Society’s prospects, the period this
assessment covers and why the period is
appropriate set out on page 67;
• The Directors’ statement on fair, balanced and
understandable set out on page 68;
• The Board’s confirmation that it has carried out a
robust assessment of the emerging and principal
risks set out on page 67;
• The section of the annual report that describes
the review of effectiveness of risk management
and internal control systems set out on pages 96
to 97; and;
• The section describing the work of the Board
Audit Committee set out on pages 84 to 90.
Directors’ Remuneration Report
The Society voluntarily prepares a Directors’
Remuneration Report in accordance with the
provisions of the Companies Act 2006. The Directors
have requested that we audit the part of the
Directors’ Remuneration Report specified by the
Companies Act 2006 to be audited as if the Society
were a quoted company.
In our opinion, the part of the Directors’
Remuneration Report to be audited has been
properly prepared in accordance with the Companies
Act 2006.
Responsibilities of Directors
As explained more fully in the Directors’
Responsibilities Statement set out on page 68, the
Directors are responsible for the preparation of the
financial statements and for being satisfied that they
give a true and fair view, and for such internal control
as the Directors determine is necessary to enable the
preparation of financial statements that are free
from material misstatement, whether due to fraud or
error.
In preparing the financial statements, the Directors
are responsible for assessing the Group and
Society’s ability to continue as a going concern,
disclosing, as applicable, matters related to going
concern and using the going concern basis of
accounting unless the Directors either intend to
liquidate the Group or the Society or to cease
operations, or has no realistic alternative but to do
so.
Auditor’s responsibilities for the audit of the
financial statements
Our objectives are to obtain reasonable assurance
about whether the financial statements as a whole
are free from material misstatement, whether due to
fraud or error, and to issue an auditor’s report that
includes our opinion. Reasonable assurance is a high
level of assurance, but is not a guarantee that an
audit conducted in accordance with ISAs (UK) will
always detect a material misstatement when it
exists. Misstatements can arise from fraud or error
and are considered material if, individually or in the
aggregate, they could reasonably be expected to
influence the economic decisions of users taken on
the basis of these financial statements.
Performance & Strategy Governance
Financial Statements
Other Information
Skipton Group Annual Report & Accounts 2025 130
Explanation as to what extent the audit was
considered capable of detecting irregularities,
including fraud
Irregularities, including fraud, are instances of non-
compliance with laws and regulations. We design
procedures in line with our responsibilities, outlined
below, to detect irregularities, including fraud. The
risk of not detecting a material misstatement due to
fraud is higher than the risk of not detecting one
resulting from error, as fraud may involve deliberate
concealment by, for example, forgery or intentional
misrepresentations, or through collusion. The extent
to which our procedures are capable of detecting
irregularities, including fraud is detailed below.
However, the primary responsibility for the
prevention and detection of fraud rests with both
those charged with governance of the Society and
the Directors.
• We obtained an understanding of the legal and
regulatory frameworks that are applicable to the
Group and determined that the most significant
were the regulations, licence conditions and
supervisory requirements of the Prudential
Regulation Authority (PRA), the Financial Conduct
Authority (FCA) and the Building Societies Act
1986.
• We understood how the Group is complying with
those frameworks by making enquiries of key
management, internal audit, and those
responsible for legal and compliance matters. We
also reviewed correspondence between the
relevant regulatory bodies, reviewed minutes of
the Board and Board Risk Committee meetings
and gained an understanding of the Group’s
approach to governance demonstrated by the
Board’s approval of the Group’s governance
framework and the Board’s review of the Group’s
Operational Risk Framework and internal control
processes.
• We assessed the susceptibility of the Group’s
financial statements to material misstatement,
including how fraud might occur by considering
the controls that the Group has established to
address risks identified by the entity, or that
otherwise seek to prevent, deter or detect fraud.
We also considered performance and incentive
plan targets and their potential to influence key
management to manage earnings or influence the
perceptions of investors and stakeholders.
• Based on this understanding we designed our
audit procedures to identify non-compliance with
such laws and regulations. Our procedures
involved inquiries of legal counsel, executive
management, internal audit, consideration of
whistleblowing events and focused testing as
referred to in the Key Audit Matters section
above. Our inquiries and procedures addressed
subsidiaries in the Group including those audited
by component teams. The Group audit team had
regular communication with component teams to
discuss the audit which included if there were any
instances of non-compliance with laws and
regulations and how these were responded to.
• The Group operates in the financial services
sector which is a highly regulated environment.
As such the Senior Statutory Auditor considered
the experience and expertise of the engagement
team to ensure that the team had the appropriate
competence and capabilities, which included the
use of specialists where appropriate.
A further description of our responsibilities for the
audit of the financial statements is located on the
Financial Reporting Council’s website at
https://www.frc.org.uk/auditorsresponsibilities. This
description forms part of our auditor’s report.
Other matters we are required to address
• Following the recommendation from the Board
Audit Committee, we were appointed by the
Society on 10 May 2019 to audit the financial
statements for the year ending 31 December
2019 and subsequent financial periods.
• The period of total uninterrupted engagement
including previous renewals and reappointments
is seven years, covering the years ending 31
December 2019 to 31 December 2025.
• The audit opinion is consistent with the additional
report to the Board Audit Committee.
Use of our report
This report is made solely to the Society’s members,
as a body, in accordance with Section 78 of the
Building Societies Act 1986. Our audit work has been
undertaken so that we might state to the Society’s
members those matters we are required to state to
them in an auditor’s report and for no other purpose.
To the fullest extent permitted by law, we do not
accept or assume responsibility to anyone other than
the Society and the Society’s members as a body, for
our audit work, for this report, or for the opinions we
have formed.
Blake Adlem (Senior statutory auditor)
for and on behalf of Ernst & Young LLP, Statutory
Auditor
Edinburgh
17 February 2026
Performance & Strategy Governance
Financial Statements
Other Information
Skipton Group Annual Report & Accounts 2025 132
For the year ended 31 December 2025
Group | Society | ||||
| £m | Notes | 2025 | 2024 | 2025 | 2024 |
| Interest receivable and similar income: | |||||
Accounted for using effective interest rate method | 2 | 1,932.3 | 2,056.9 | ||
Other | 2 | 24.5 | 26.6 | ||
| Total interest receivable and similar income | 2 | 1,956.8 | 2,083.5 | ||
Interest payable and similar charges | 3 | ( | ( | (1,514.6) | (1,676.3) |
Net interest receivable | 442.2 | 407.2 | |||
Fees and commissions receivable | 4 | 37.9 | 36.0 | ||
| Fees and commissions payable | ( | ( | (3.7) | (3.3) | |
| Fair value (losses) / gains on financial instruments | 5 | ( | 1.7 | 12.2 | |
| mandatorily held at FVTPL | |||||
| Charge on buy-back of Permanent Interest-Bearing | ( | (27.9) | - | ||
| Shares | |||||
| Income from shares in subsidiary undertakings | 82.8 | 36.0 | |||
Other operating income | 6 | 12.3 | 9.4 | ||
Total income | 545.3 | 497.5 | |||
Administrative expenses | 7 | ( | ( | (262.4) | (262.0) |
Operating profit before impairment and provisions | 282.9 | 235.5 | |||
Impairment and provisions | 8 | ( | (10.8) | 10.4 | |
Profit before tax | 272.1 | 245.9 | |||
Tax expense | 12 | ( | ( | (49.5) | (56.7) |
Profit for the year | 222.6 | 189.2 | |||
Attributable to: | |||||
| Members of the Society | 222.6 | 189.2 | |||
| Non-controlling interests | - | - | |||
Profit for the year | 222.6 | 189.2 |
Segmental performance of the Group is shown in Note 47.
The accompanying Notes form part of these financial statements.
Performance & Strategy Governance
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Other Information
Skipton Group Annual Report & Accounts 2025 133
For the year ended 31 December 2025
Group | Society | ||||
£m | Notes | 2025 | 2024 | 2025 | 2024 |
Profit for the year | 222.6 | 189.2 | |||
Other comprehensive (expense) / income: | |||||
Items that will not be reclassified to Income Statement: | |||||
| Remeasurement losses on net defined benefit | 36 | ( | ( | (17.5) | (2.7) |
| obligations | |||||
Income tax on items that will not be reclassified to Income Statement | 40 | 4.9 | 0.8 | ||
Net other comprehensive expense that will not be reclassified to Income Statement | ( | ( | (12.6) | (1.9) | |
Items that may subsequently be reclassified to Income Statement: | |||||
Cash flow hedging reserve: | |||||
| (Losses) / gains taken to equity | ( | ( | 17.5 | (35.2) | |
| Realised (gains) / losses transferred to Income | ( | (6.0) | 45.9 | ||
| Statement | |||||
Fair value reserve: | |||||
| Gains / (losses) taken to equity | ( | 6.0 | (1.8) | ||
Cost of hedging reserve: | |||||
| Gains / (losses) taken to equity | ( | 0.1 | - | ||
| Exchange differences on translation of foreign | ( | ( | - | - | |
| operations | |||||
Income tax on items that may be reclassified to Income Statement | 40 | ( | (4.9) | (2.5) | |
Net other comprehensive (expense) / income that may | ( | 12.7 | 6.4 | ||
subsequently be reclassified to Income Statement | |||||
Other comprehensive (expense) / income | ( | 0.1 | 4.5 | ||
Total comprehensive income | 222.7 | 193.7 | |||
Attributable to: | |||||
| Members of the Society | 222.7 | 193.7 | |||
| Non-controlling interests | - | - | |||
Total comprehensive income | 222.7 | 193.7 |
The accompanying Notes form part of these financial statements.
Performance & Strategy Governance
Financial Statements
Other Information
Skipton Group Annual Report & Accounts 2025 134
As at 31 December 2025
Group | Society | ||||
| £m | Notes | 2025 | 2024 | 2025 | 2024 |
Assets | |||||
| Cash in hand and balances with the Bank of England | 1,360.2 | 1,930.6 | |||
| Loans and advances to credit institutions | 13 | 304.7 | 397.8 | ||
| Debt securities | 14 | 4,275.4 | 4,340.1 | ||
| Derivative financial instruments | 333.1 | 743.0 | |||
Loans and advances to customers held at amortised | 15 | 31,121.3 | 28,334.9 | ||
| cost | |||||
| Loans and advances to customers held at FVTPL | 19 | 0.8 | 0.9 | ||
| Equity release portfolio held at FVTPL | 18 | 263.1 | 277.2 | ||
| Current tax asset | 2.3 | - | |||
| Investments in subsidiary undertakings and joint | 20 | 560.1 | 509.3 | ||
| ventures | |||||
| Assets held for sale | 21 | 3.7 | - | ||
| Property, plant and equipment | 22 | 42.3 | 43.1 | ||
| Right-of-use assets | 23 | 8.0 | 8.3 | ||
| Deferred tax asset | 34 | 6.2 | 11.2 | ||
| Other assets | 26 | 26.5 | 22.9 | ||
| Intangible assets | 25 | 8.3 | 4.2 | ||
Loan to defined benefit pension scheme held at FVTPL | 35 | 10.9 | - | ||
| Retirement benefit surplus | 36 | - | 4.8 | ||
Total assets | 38,326.9 | 36,628.3 | |||
Liabilities | |||||
| Shares | 27 | 30,524.3 | 28,254.1 | ||
| Amounts owed to credit institutions | 28 | 513.1 | 1,800.6 | ||
| Amounts owed to other customers | 29 | 1,171.9 | 1,268.9 | ||
| Debt securities in issue | 30 | 2,955.0 | 1,930.1 | ||
| Derivative financial instruments | 205.0 | 282.2 | |||
| Current tax liability | 1.5 | 2.7 | |||
| Lease liabilities | 31 | 8.2 | 8.6 | ||
| Other liabilities | 32 | 12.6 | 11.0 | ||
| Accruals and deferred income | 29.7 | 27.6 | |||
| Provisions for liabilities | 33 | 5.1 | 5.3 | ||
| Deferred tax liability | 34 | - | - | ||
| Retirement benefit obligations | 36 | 1.2 | - | ||
| Subordinated liabilities | 37 | 356.0 | 690.2 | ||
| Subscribed capital | 38 | 15.2 | 41.6 | ||
Total liabilities | 35,798.8 | 34,322.9 |
Consolidated Statement of Financial Position continues on page 135.
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Skipton Group Annual Report & Accounts 2025 135
As at 31 December 2025
Group | Society | ||||
| £m | Notes | 2025 | 2024 | 2025 | 2024 |
Members' interests | |||||
| General reserve | 2,524.7 | 2,314.7 | |||
| Fair value reserve | ( | ( | (6.3) | (10.6) | |
| Cash flow hedging reserve | 9.6 | 1.3 | |||
| Cost of hedging reserve | ( | ( | 0.1 | - | |
| Translation reserve | - | - | |||
Attributable to members of the Society | 2,528.1 | 2,305.4 | |||
| Non-controlling interests | ( | - | - | ||
Total members' interests | 2,528.1 | 2,305.4 | |||
Total liabilities and members' interests | 38,326.9 | 36,628.3 |
The accompanying Notes form part of these financial statements.
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Skipton Group Annual Report & Accounts 2025 136
Group | General | Fair value | Cash flow | Cost of | Translation | Sub- | Non- | |
£m | reserve | reserve | hedging | hedging | reserve | total | controlling | Total |
| reserve | reserve | interests | ||||||
For the year ended 31 December 2025 | ||||||||
Balance at 1 January 2025 | ( | ( | ( | |||||
Profit for the year | ||||||||
Other comprehensive (expense) / income net of tax: | ||||||||
Remeasurement losses on defined benefit obligations | ( | ( | ( | |||||
Net gains / (losses) from changes in fair value | ( | |||||||
Realised gains transferred to Income Statement | ( | ( | ( | |||||
Exchange differences on translation of foreign | ( | ( | ( | |||||
| operations | ||||||||
Other comprehensive | ( | ( | ( | ( | ( | |||
(expense) / income | ||||||||
Total comprehensive income / (expense) for the year | ( | ( | ||||||
Non -controlling interests | ||||||||
arising on recognition of subsidiary undertakings with less than 100% ownership | ||||||||
Balance at 31 December | ( | ( | ||||||
2025 |
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Skipton Group Annual Report & Accounts 2025 137
Group | General | Fair value | Cash flow | Cost of | Translation | Sub- | Non- | |
£m | reserve | reserve | hedging | hedging | reserve | total | controlling | Total |
| reserve | reserve | interests | ||||||
For the year ended 31 December 2024 | ||||||||
Balance at 1 January 2024 | ( | ( | ( | |||||
Profit for the year | ||||||||
Other comprehensive (expense) / income net of tax: | ||||||||
Remeasurement losses on defined benefit obligations | ( | ( | ( | |||||
Net losses from changes in fair value | ( | ( | ( | ( | ( | |||
Realised losses transferred to Income Statement | ||||||||
Exchange differences on translation of foreign | ( | ( | ( | |||||
| operations | ||||||||
Other comprehensive | ( | ( | ( | ( | ||||
(expense) / income | ||||||||
Total comprehensive income / | ( | ( | ( | |||||
(expense) for the year | ||||||||
Balance at 31 December 2024 | ( | ( | ( |
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Skipton Group Annual Report & Accounts 2025 138
Society
£m
General reserve
Fair value reserve
Cash flow
hedging reserve
Cost of hedging
reserve
Total
For the year ended 31 December 2025
Balance at 1 January
2025
2,314.7
(10.6)
1.3
-
2,305.4
Profit for the year
222.6
-
-
-
222.6
Other comprehensive (expense) / income net of tax:
Remeasurement losses
on defined benefit
obligations
(12.6)
-
-
-
(12.6)
Net gains from
changes in fair value
-
4.3
12.6
0.1
17.0
Realised gains
transferred to Income
Statement
-
-
(4.3)
-
(4.3)
Other comprehensive
(expense) / income
(12.6)
4.3
8.3
0.1
0.1
Total comprehensive
income for the year
210.0
4.3
8.3
0.1
222.7
Balance at 31
December 2025
2,524.7
(6.3)
9.6
0.1
2,528.1
Society
£m
General reserve
Fair value reserve
Cash flow
hedging reserve
Cost of hedging
reserve
Total
For the year ended 31 December 2024
Balance at 1 January
2024
2,127.4
(9.3)
(6.4)
-
2,111.7
Profit for the year
189.2
-
-
-
189.2
Other comprehensive (expense) / income net of tax:
Remeasurement losses
on defined benefit
obligations
(1.9)
-
-
-
(1.9)
Net losses from
changes in fair value
-
(1.3)
(25.3)
-
(26.6)
Realised losses
transferred to Income
Statement
-
-
33.0
-
33.0
Other comprehensive
(expense) / income
(1.9)
(1.3)
7.7
-
4.5
Total comprehensive
income / (expense) for
the year
187.3
(1.3)
7.7
-
193.7
Balance at 31 December
2024
2,314.7
(10.6)
1.3
-
2,305.4
The accompanying Notes form part of these financial statements.
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Skipton Group Annual Report & Accounts 2025 139
For the year ended 31 December 2025
Group | Society | ||||
| £m | Notes | 2025 | 2024 | 2025 | 2024 |
Cash flows from operating activities | |||||
Profit before tax | 272.1 | 245.9 | |||
Adjustments for: | |||||
| Impairment charge / (credits) on financial | 39ai) | ( | 2.1 | (16.7) | |
| instruments | |||||
| Depreciation and amortisation | 22, 23, | 8.7 | 8.5 | ||
24, 25 | |||||
Impairment of property, plant and equipment, right - | 22, 23, | ||||
of-use assets, investment property and intangible assets | 24, 25 | (0.1) | - | ||
(Profit) / loss on disposal of property, plant and equipment, investment property and intangible assets | ( | ( | (0.1) | 0.6 | |
Fair value losses / (gains) on financial instruments | 39aii) | ( | (1.7) | (12.2) | |
| held at FVTPL | |||||
| Interest on subordinated liabilities and subscribed | 3 | 32.1 | 34.1 | ||
| capital | |||||
Interest on lease liabilities | 3 | 0.3 | 0.3 | ||
| Income from shares in subsidiary undertakings | (82.8) | (36.0) | |||
Charge on buy-back of Permanent Interest- Bearing | 27.9 | - | |||
| Shares (PIBS) | |||||
| Other non-cash movements | 39aiii) | ( | ( | (16.3) | (2.7) |
242.2 | 221.8 | ||||
Changes in operating assets and liabilities: | |||||
| Movement in prepayments and accrued income | ( | ( | (5.8) | 0.7 | |
| Movement in accruals and deferred income | 2.1 | (4.2) | |||
| Movement in provisions for liabilities | ( | ( | - | (0.2) | |
| Net movement in derivatives | 71.5 | 42.9 | |||
| Movement in loans and advances to customers | ( | ( | (2,451.9) | (2,376.0) | |
| Movement in shares | 2,199.5 | 2,317.2 | |||
| Net movement in amounts owed to credit | ( | ( | (1,384.5) | (41.0) | |
| institutions and other customers | |||||
| Net movement in debt securities in issue | ( | 1,024.9 | (312.4) | ||
| Net movement in loans and advances to credit | 70.3 | 180.9 | |||
| institutions | |||||
| Net movement in other assets | ( | ( | (2.8) | (0.3) | |
| Net movement in other liabilities | 3.6 | (7.7) | |||
| Contributions to defined benefit pension scheme | ( | ( | (10.7) | (23.0) | |
| Income taxes paid | ( | ( | (47.8) | (50.8) | |
Net cash flows from operating activities | ( | ( | (289.4) | (52.1) |
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Skipton Group Annual Report & Accounts 2025 140
For the year ended 31 December 2025
Group | Society | ||||
| £m | Notes | 2025 | 2024 | 2025 | 2024 |
Net cash flows from operating activities | ( | ( | (289.4) | (52.1) | |
Cash flows from investing activities | |||||
Purchase of debt securities | 14 | ( | ( | (1,410.3) | (3,986.6) |
Proceeds from maturities and disposals of debt | 1,537.7 | 2,830.1 | |||
securities | |||||
Dividends received from subsidiary undertakings | 82.8 | 36.0 | |||
Increase in loans to subsidiary undertakings | 20a) | (50.8) | (31.2) | ||
Purchase of subsidiary undertakings in the year, net of cash acquired | ( | - | - | ||
Other investing activities | 39bi) | ( | ( | (23.2) | (14.6) |
Net cash flows from investing activities | ( | 136.2 | (1,166.3) | ||
Cash flows from financing activities | |||||
Exercise of put options held by non -controlling | ( | - | - | ||
shareholders | |||||
Buy -back of Permanent Interest-Bearing Shares | ( | (52.9) | - | ||
(PIBS) | |||||
Redemption of subordinated liabilities | ( | (350.0) | - | ||
Interest paid on subordinated liabilities and subscribed capital | ( | ( | (34.8) | (33.5) | |
Interest paid on lease liabilities | 31 | ( | ( | (0.3) | (0.3) |
Payment of lease liabilities | 31 | ( | ( | (2.1) | (2.3) |
Net cash flows from financing activities | ( | ( | (440.1) | (36.1) | |
Net decrease in cash and cash equivalents | ( | ( | (593.3) | (1,254.5) | |
Cash and cash equivalents at 1 January | 1,984.6 | 3,239.1 | |||
Decrease in impairment loss allowance on cash and cash equivalents | 13 | 0.1 | - | ||
Cash and cash equivalents at 31 December | 1,391.4 | 1,984.6 | |||
| Analysis of the cash balances as shown within the Statement of Financial Position: | |||||
As at 31 December 2025 | Group | Society | |||
| £m | Notes | 2025 | 2024 | 2025 | 2024 |
| Cash in hand and balances with Bank of England | 1,360.2 | 1,930.6 | |||
| Loans and advances to credit institutions | 13 | 31.2 | 54.0 | ||
Cash and cash equivalents at 31 December | 1,391.4 | 1,984.6 |
The accompanying Notes form part of these financial statements.
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Skipton Group Annual Report & Accounts 2025 142
The material accounting policy information relevant to these consolidated Annual Accounts is set out below.
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| Group | Repayable | Up to 3 | 3 -12 | 1 - 5 | Over 5 | No | |
| £m | on demand | months | months | years | years | specified | Total |
| maturity | |||||||
| Previously reported: | |||||||
| Debt securities in issue | 5.1 | 0.8 | 1,938.7 | 490.7 | - | - | 2,435.3 |
| Total financial liabilities | 12,335.2 | 4,469.8 | 13,220.5 | 5,009.1 | 485.1 | 598.9 | 36,118.6 |
| Net liquidity gap | (10,041.4) | (3,876.3) | (12,219.3) | (1,261.1) | 30,004.7 | (291.4) | 2,315.2 |
Adjustments: | |||||||
| Debt securities in issue | (5.1) | 5.1 | (1,938.7) | 1,938.7 | - | - | - |
| Total financial liabilities | (5.1) | 5.1 | (1,938.7) | 1,938.7 | - | - | - |
| Net liquidity gap | (5.1) | 5.1 | (1,938.7) | 1,938.7 | - | - | - |
| Restated: | |||||||
| Debt securities in issue | - | 5.9 | - | 2,429.4 | - | - | 2,435.3 |
| Total financial liabilities | 12,330.1 | 4,474.9 | 11,281.8 | 6,947.8 | 485.1 | 598.9 | 36,118.6 |
| Net liquidity gap | (10,036.3) | (3,881.4) | (10,280.6) | (3,199.8) | 30,004.7 | (291.4) | 2,315.2 |
| Society | Repayable | Up to 3 | 3 - 12 | 1 - 5 | Over 5 | No | |
| £m | on demand | months | months | years | years | specified | Total |
| maturity | |||||||
| Previously reported: | |||||||
| Debt securities in issue | 5.1 | - | 1,925.0 | - | - | - | 1,930.1 |
| Total financial liabilities | 11,909.7 | 3,993.1 | 12,173.2 | 5,145.4 | 458.8 | 598.9 | 34,279.1 |
| Net liquidity gap | (9,515.2) | (3,658.2) | (11,231.2) | (1,172.6) | 27,984.5 | (256.1) | 2,151.2 |
Adjustments: | |||||||
| Debt securities in issue | (5.1) | 5.1 | (1,925.0) | 1,925.0 | - | - | - |
| Total financial liabilities | (5.1) | 5.1 | (1,925.0) | 1,925.0 | - | - | - |
| Net liquidity gap | (5.1) | 5.1 | (1,925.0) | 1,925.0 | - | - | - |
| Restated: | |||||||
| Debt securities in issue | - | 5.1 | - | 1,925.0 | - | - | 1,930.1 |
| Total financial liabilities | 11,904.6 | 3,998.2 | 10,248.2 | 7,070.4 | 458.8 | 598.9 | 34,279.1 |
Net liquidity gap | (9,510.1) | (3,663.3) | (9,306.2) | (3,097.6) | 27,984.5 | (256.1) | 2,151.2 |
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Skipton Group Annual Report & Accounts 2025 144
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Society | £m |
Previously reported: | |
| On financial liabilities held at amortised cost: | |
| On deposits and other borrowings – subsidiary undertakings | 71.1 |
| Total on financial liabilities held at amortised cost | 1,392.1 |
| On financial instruments held at FVTPL: | |
| Net expense on derivative financial instruments held for hedging liabilities | 138.3 |
| Total interest payable and similar charges | 1,676.3 |
Adjustments: | |
| On financial liabilities held at amortised cost: | |
| On deposits and other borrowings – subsidiary undertakings | (46.7) |
| Total on financial liabilities held at amortised cost | (46.7) |
| On financial instruments held at FVTPL: | |
| Net expense on derivative financial instruments held for hedging liabilities | 46.7 |
| Total interest payable and similar charges | - |
Restated: | |
| On financial liabilities held at amortised cost: | |
| On deposits and other borrowings – subsidiary undertakings | 24.4 |
| Total on financial liabilities held at amortised cost | 1,345.4 |
| On financial instruments held at FVTPL: | |
| Net expense on derivative financial instruments held for hedging liabilities | 185.0 |
| Total interest payable and similar charges | 1,676.3 |
Skipton Group Annual Report & Accounts 2025 145
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Freehold and long leasehold buildings | 50 to 100 years |
Special purpose freehold head office facilities | 40 years |
Refurbishment of freehold and long leasehold buildings | 5 to 10 years |
Short leasehold buildings | Period of lease |
Equipment, fixtures and fittings | 2 to 10 years |
Motor vehicles | 25% reducing balance |
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Lifetime PD band at initial recognition | Applied at 31 December 2025 | Applied at 31 December 2024 |
Slight risk | Initial estimate x 8 | Initial estimate x 9 |
Low risk | Initial estimate x 4 | Initial estimate x 5 |
Medium risk | Initial estimate x 3 | Initial estimate x 4 |
High risk | Initial estimate x 1 | Initial estimate x 1 |
Skipton Group Annual Report & Accounts 2025 169
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As at 31 December 2025 | Notes | Scenario | 2026 | 2027 | 2028 | 2029 | 2030 |
Upside | 3.00 | 3.00 | 3.00 | 3.00 | 3.00 | ||
Bank of England Base Rate (%) | A | Central | 3.50 | 3.50 | 3.50 | 3.75 | 4.00 |
Downside | 6.00 | 5.25 | 5.00 | 4.75 | 4.50 | ||
Upside | 4.0 | 4.0 | 4.0 | 4.0 | 4.0 | ||
Unemployment (%) | A | Central | 5.0 | 4.8 | 4.7 | 4.5 | 4.5 |
Downside | 7.0 | 6.0 | 6.0 | 6.0 | 6.0 | ||
Upside | 4.2 | 4.2 | 4.2 | 4.2 | 4.2 | ||
UK House price inflation (%) | B | Central | 2.5 | 2.0 | 1.5 | 2.5 | 3.0 |
Downside | (10.6) | (3.0) | 1.0 | 4.0 | 4.0 |
As at 31 December 2024 | Notes | Scenario | 2025 | 2026 | 2027 | 2028 | 2029 |
Upside | 3.50 | 3.50 | 3.50 | 3.50 | 3.50 | ||
Bank of England Base Rate (%) | A | Central | 4.00 | 3.75 | 3.75 | 3.75 | 3.75 |
Downside | 6.00 | 6.00 | 5.00 | 5.00 | 5.00 | ||
Upside | 4.0 | 4.0 | 4.0 | 4.0 | 4.0 | ||
Unemployment (%) | A | Central | 4.1 | 4.3 | 4.4 | 4.4 | 4.2 |
Downside | 6.7 | 6.0 | 6.0 | 6.0 | 6.0 | ||
Upside | 4.2 | 4.2 | 4.2 | 4.2 | 4.2 | ||
UK House price inflation (%) | B | Central | 3.0 | 3.5 | 2.5 | 3.0 | 4.0 |
Downside | (1.0) | (11.5) | (1.0) | 1.0 | 4.0 |
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Skipton Group Annual Report & Accounts 2025 172
Notes | Scenario | 2025 | 2024 | |
| Upside | 3.00 / 3.75 | 3.50 / 4.25 | ||
Bank of England Base Rate (%) | A | Central | 3.50 / 4.00 | 3.75 / 4.75 |
| Downside | 3.75 / 6.00 | 4.75 / 6.00 | ||
| Upside | 4.8 | 4.1 | ||
Unemployment (%) | B | Central | 5.2 | 4.4 |
| Downside | 7.5 | 7.0 | ||
| Upside | 22.6 / 0.0 | 22.6 / 0.0 | ||
UK House price inflation (%) | C | Central | 12.1 / 0.0 | 17.2 / 0.0 |
| Downside | 0.0 / (13.3) | 0.0 / (13.3) |
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Group | Society | ||||
| £m | Notes | 2025 | 2024 2025 | 2024 | |
Residential mortgages | |||||
Model Risk – downturn | A | 2.7 | 1.3 | 2.7 | 1.3 |
Flats subject to fire safety risks | B | 2.1 | 1.4 | 2.1 | 1.4 |
4.8 | 2.7 | 4.8 | 2.7 |
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| Scenario | ECL (£m) | Share of Gross | ||||||||
2025 | Notes | weighting (%) | (Note A) | Exposures (%) | ||||||
| (Note B) | ||||||||||
Upside | Central Downside Stage 1 | Stage 2 Stage 3 | Total | Stage 1 Stage 2 | ||||||
| Residential | ||||||||||
Actual probability weighted ECL | 15 | 55 | 30 | 8.6 | 5.4 | 7.6 | 21.6 | 97.8 | 1.8 | |
| 100% upside | 100 | - | - | 2.8 | 2.2 | 6.1 | 11.1 | 98.3 | 1.3 | |
| 100% central | - | 100 | - | 3.8 | 3.3 | 6.9 | 14.0 | 98.0 | 1.6 | |
| 100% downside | - | - | 100 | 11.7 | 13.1 | 13.1 | 37.9 | 95.6 | 4.0 | |
| Commercial | ||||||||||
Actual probability weighted ECL | 15 | 55 | 30 | 0.4 | 0.3 | 1.9 | 2.6 | 80.9 | 9.9 | |
100% upside | C, D | 100 | - | - | 0.4 | 0.3 | 1.9 | 2.6 | 80.9 | 9.9 |
100% central | C, D | - | 100 | - | 0.4 | 0.3 | 1.9 | 2.6 | 80.9 | 9.9 |
100% downside | C, D | - | - | 100 | 0.4 | 0.3 | 1.9 | 2.6 | 80.9 | 9.9 |
| Scenario | ECL (£m) | Share of Gross | |||||||||
2024 | Notes | weighting (%) | (Note A) | Exposures (%) | |||||||
| (Note B) | |||||||||||
Upside | Downside Stage 1 | Central | Stage 2 Stage 3 | Total | Stage 1 | Stage 2 | |||||
| Residential | |||||||||||
Actual probability weighted ECL | 10 | 60 | 30 | 4.5 | 2.5 | 6.5 | 13.5 | 98.5 | 1.1 | ||
| 100% upside | 100 | - | - | 2.2 | 1.1 | 4.7 | 8.0 | 98.6 | 1.0 | ||
| 100% central | - | 100 | - | 2.7 | 1.3 | 5.0 | 9.0 | 98.6 | 1.0 | ||
| 100% downside | - | - | 100 | 8.1 | 5.4 | 8.6 | 22.1 | 98.2 | 1.4 | ||
| Commercial | |||||||||||
Actual probability weighted ECL | 10 | 60 | 30 | 0.2 | 0.2 | 4.3 | 4.7 | 82.2 | 5.2 | ||
100% upside | C, D | 100 | - | - | 0.2 | 0.2 | 4.3 | 4.7 | 82.2 | 5.2 | |
100% central | C, D | - | 100 | - | 0.2 | 0.2 | 4.3 | 4.7 | 82.2 | 5.2 | |
100% downside | C, D | - | - | 100 | 0.2 | 0.2 | 4.3 | 4.7 | 82.2 | 5.2 | |
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Skipton Group Annual Report & Accounts 2025 175
Impact on impairment loss allowance of changes to assumptions
Group | Society | |||||||
| £m | Notes | Changes to assumption | Increase / (decrease) in impairment loss allowance | |||||
2025 | 2024 | 2025 | 2024 | |||||
Downside scenario | A | Absolute increase of 10% | 1.6 | 0.7 | 1.5 | 0.7 | ||
weighting | ||||||||
Significant increase in credit | B | Relative reduction by 25% | 0.4 | 0.1 | 0.4 | 0.1 | ||
risk criteria | ||||||||
Future house price inflation | C | + / - 0.5% pa | (0.9) / 1.0 | (0.5) / 0.6 | (0.9) / 1.0 | (0.4) / 0.5 | ||
Unemployment | D | + / - 0.5% pa | 0.9 / (0.8) | 0.5 / (0.4) | 0.9 / (0.8) | 0.5 / (0.4) |
Group | Society | ||||||
| £m | Notes | Changes to assumption | Increase / (decrease) in impairment loss allowance | ||||
2025 | 2024 | 2025 | 2024 | ||||
Lifetime Loss Rate | A | + / - 1% | 0.2 / (0.2) | 0.1 / (0.1) | 0.1 / (0.1) | 0.2 / (0.2) |
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Skipton Group Annual Report & Accounts 2025 176
Group (£m) | Society (£m) | |||||
| Assumption | Change to current assumption | Increase in impairment allowance | ||||
2025 | 2024 | 2025 | 2024 | |||
Downside scenario weighting | Absolute increase of 10% | 0.1 | 0.1 | 0.1 | 0.1 | |
Downside scenario weighting | Increase to 100% | 1.1 | 1.1 | 1.1 | 1.1 | |
| Group and Society (£m) | |||
| Assumption | Change to current assumption | Increase / (Decrease) in portfolio fair value | |
2025 | 2024 | ||
Redemption rates | + / - 1% pa | (0.4) / 0.5 | 0.4 / (0.5) |
Illiquidity premia | + / - 0.2% pa | (4.3) / 4.4 | (3.7) / 3.8 |
HPI forecast | + / - 0.5% pa | 4.0 / (4.3) | 4.4 / (4.7) |
Property volatility | + / - 1% pa | (2.6) / 2.6 | (2.4) / 2.4 |
RPI volatility | + / - 0.5% pa | (1.0) / 0.6 | (0.2) / 0.0 |
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Skipton Group Annual Report & Accounts 2025 177
| Group & Society (£m) | ||||
| Assumption | Notes Change to current assumption | (Decrease) / increase in liability | ||
2025 | 2024 | |||
Redemption rates | A | + / - 1% pa | (0.0) / 0.0 | (0.6) / 0 .6 |
RPI volatility | A | + / - 0.5% pa | (0.9) / 0.6 | (2.0) / 1.5 |
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Skipton Group Annual Report & Accounts 2025 178
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Skipton Group Annual Report & Accounts 2025 179
Group (£m) | Society (£m) | |||||
Assumption | Changes to assumption | (Decrease) / increase in liabilities | ||||
2025 | 2024 | 2025 | 2024 | |||
Discount rate | + / -0.25% pa | (4.6) / 4.8 | (5.5) / 5.7 | (2.4) / 2.6 | (2.5) / 2.7 | |
Rate of inflation | + / -0.5% pa | 3.8 / (3.6) | 3.9 / (3.7) | 1.8 / (1.7) | 1.9 / (1.8) | |
Commutation allowance | + / -10% pa | 0.0 / 0.1 | (0.1) / 0.1 | 0.0 / 0.1 | - | |
Life expectancy | + / -1 year | 4.6 / (4.5) | 6.0 / (6.2) | 2.5 / (2.4) | 2.4 / (2.4) | |
| Group & Society (£m) | |||||
| Assumption | Notes Change to current assumption | (Decrease) / increase in loan fair value | |||
2025 | 2024 | ||||
Discount rate | A | + / - 1% pa | (0.1) / 0.1 | N/A | |
Value of illiquid assets | A | + / - 10% expected proceeds | 1.1 / (1.1) | N/A |
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Skipton Group Annual Report & Accounts 2025 180
Group | Society | |||
£m | 2025 | 2024 | 2025 | 2024 |
On financial assets held at amortised cost: | ||||
| On loans fully secured on residential property | 1,399.3 | 1,207.2 | 1,291.7 | 1,102.0 |
| On other loans and advances: | ||||
| To subsidiary undertakings | - | - | 129.9 | 122.6 |
| Other | 25.2 | 26.9 | 6.1 | 8.3 |
| On other liquid assets | 85.4 | 140.9 | 84.6 | 138.9 |
1,509.9 | 1,375.0 | 1,512.3 | 1,371.8 | |
On financial assets held at FVOCI: | ||||
| On debt securities | 182.2 | 178.6 | 176.4 | 168.9 |
On financial instruments held at FVTPL: | ||||
| Net income on derivative financial instruments held to hedge | 243.6 | 516.2 | 243.6 | 516.2 |
| assets in qualifying hedge accounting relationships | ||||
Interest receivable and similar income accounted for using | 1,935.7 | 2,069.8 | 1,932.3 | 2,056.9 |
the effective interest rate method | ||||
On financial instruments held at FVTPL: | ||||
| On loans and advances to customers | 0.1 | 0.1 | 0.1 | 0.1 |
| On equity release portfolio | 21.8 | 19.4 | 21.8 | 19.4 |
| On debt securities | - | - | 3.3 | 4.1 |
| On loan to defined benefit pension scheme | 0.8 | - | 0.8 | - |
| Net (expense) / income on derivative financial instruments held | ||||
| to hedge assets in non-qualifying hedge accounting | (1.5) | 13.0 | (1.5) | 3.0 |
| relationships | ||||
Other interest and similar income | 21.2 | 32.5 | 24.5 | 26.6 |
Total interest receivable and similar income | 1,956.9 | 2,102.3 | 1,956.8 | 2,083.5 |
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Skipton Group Annual Report & Accounts 2025 181
Group | Society | |||
£m | 2025 | 2024 | 2025 | 2024 |
| restated* | ||||
On financial liabilities held at amortised cost: | ||||
| On shares held by individuals | 1,067.0 | 1,081.7 | 1,067.0 | 1,081.7 |
| On shares held by others | 8.7 | 8.7 | 8.7 | 8.7 |
| On subscribed capital | 4.3 | 4.5 | 4.3 | 4.5 |
| On deposits and other borrowings: | ||||
| Subordinated liabilities | 27.8 | 29.6 | 27.8 | 29.6 |
| Subsidiary undertakings | - | - | 22.0 | 24.4 |
| Wholesale and other funding | 271.8 | 322.9 | 150.0 | 196.2 |
| Lease liabilities | 4.6 | 3.1 | 0.3 | 0.3 |
1,384.2 | 1,450.5 | 1,280.1 | 1,345.4 | |
On financial instruments held at FVTPL: | ||||
Net expense on derivative financial instruments held for hedging | 56.9 | 163.4 | 76.9 | 185.0 |
| liabilities (note A) | ||||
| Deemed loans from Group undertakings | - | - | 157.5 | 145.9 |
| Other | 0.9 | - | 0.1 | - |
Total interest payable and similar charges | 1,442.0 | 1,613.9 | 1,514.6 | 1,676.3 |
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Skipton Group Annual Report & Accounts 2025 182
The tables below provide further information regarding the nature, amount and timing of fees and
commissions receivable. IFRS 15 requires that revenue is recognised by the Group in a way that depicts the
transfer of goods or services to customers; some revenue is therefore recognised at a point in time and some
revenue is recognised over a period of time. Further details as to the revenue recognition policies applied to
fees and commissions receivable by the Group are set out in Note 1n).
| 2025 | 2024 | |||||
Products and | Products and | Products and | Products and | |||
| Group | services | services | services | services | ||
| £m | transferred | transferred | Total | transferred | transferred | Total |
| at a point in | over time | at a point in | over time | |||
| time | time | |||||
Mortgage origination fees | 108.2 | - | 108.2 | 97.8 | 0.4 | 98.2 |
Other mortgage related | 2.7 | - | 2.7 | 2.1 | - | 2.1 |
fees | ||||||
General insurance income | 80.4 | 0.5 | 80.9 | 77.5 | 1.0 | 78.5 |
Commissions earned on property sales | 350.1 | - | 350.1 | 320.4 | - | 320.4 |
Commissions earned on property lettings | 148.9 | 110.6 | 259.5 | 146.3 | 101.3 | 247.6 |
Commercial property | 54.6 | 59.4 | 114.0 | 44.3 | 47.5 | 91.8 |
services fees | ||||||
Survey and valuation fees | 119.2 | - | 119.2 | 112.0 | - | 112.0 |
Asset management | 27.2 | 0.2 | 27.4 | 20.8 | 0.2 | 21.0 |
commission | ||||||
Conveyancing fees | 73.5 | - | 73.5 | 64.6 | - | 64.6 |
Financial advice fees | 35.6 | - | 35.6 | 33.9 | - | 33.9 |
Software and consultancy | - | 16.9 | 16.9 | - | 16.8 | 16.8 |
fees | ||||||
Factoring and invoice | 16.9 | - | 16.9 | 15.5 | - | 15.5 |
discounting services | ||||||
Other fees and commissions | 9.7 | 0.4 | 10.1 | 12.6 | 0.5 | 13.1 |
Total fees and commissions | 1,027.0 | 188.0 | 1,215.0 | 947.8 | 167.7 | 1,115.5 |
receivable |
| 2025 | 2024 | |||||
Products and | Products and | Products and | Products and | |||
| Society | services | services | services | services | ||
| £m | transferred | transferred | Total | transferred | transferred | Total |
| at a point in | over time | at a point in | over time | |||
| time | Time | |||||
Other mortgage related | 2.5 | - | 2.5 | 1.9 | - | 1.9 |
fees | ||||||
General insurance income | - | 0.5 | 0.5 | - | 1.0 | 1.0 |
Financial advice fees | 34.9 | - | 34.9 | 33.0 | - | 33.0 |
Other fees and commissions | - | - | - | 0.1 | - | 0.1 |
Total fees and commissions | 37.4 | 0.5 | 37.9 | 35.0 | 1.0 | 36.0 |
receivable |
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Skipton Group Annual Report & Accounts 2025 183
The table below provides a reconciliation of fees and commissions receivable by the Group to the amounts
presented by reportable segment in Note 47.
| 2025 | |||||
Group (£m) | Society | SIL | Connells | Other^ | Total |
Mortgage origination fees | - | - | 110.5 | (2.3) | 108.2 |
Other mortgage related fees | 2.5 | 0.2 | - | - | 2.7 |
General insurance income | 0.5 | - | 80.4 | - | 80.9 |
Commissions earned on property sales | - | - | 350.1 | - | 350.1 |
Commissions earned on property lettings | - | - | 259.5 | - | 259.5 |
Commercial property services fees | - | - | 114.0 | - | 114.0 |
Survey and valuation fees | - | - | 128.7 | (9.5) | 119.2 |
Asset management commission | - | - | 27.4 | - | 27.4 |
Conveyancing fees | - | - | 74.4 | (0.9) | 73.5 |
Financial advice fees | 34.9 | - | - | 0.7 | 35.6 |
Software and consultancy fees | - | - | - | 16.9 | 16.9 |
Factoring and invoice discounting services | - | - | - | 16.9 | 16.9 |
Other fees and commissions | - | 0.1 | 10.0 | - | 10.1 |
Fees and commissions receivable | 37.9 | 0.3 | 1,155.0 | 21.8 | 1,215.0 |
Fees and commissions payable and other operating income | 8.3 | - | 0.1 | (10.8) | (2.4) |
Net non -interest income | 46.2 | 0.3 | 1,155.1 | 11.0 | 1,212.6 |
| 2024 | |||||
Group (£m) | Society | SIL | Connells | Other^ | Total |
Mortgage origination fees | - | - | 100.6 | (2.4) | 98.2 |
Other mortgage related fees | 1.9 | 0.3 | - | (0.1) | 2.1 |
General insurance income | 1.0 | - | 77.5 | - | 78.5 |
Commissions earned on property sales | - | - | 320.4 | - | 320.4 |
Commissions earned on property lettings | - | - | 247.6 | - | 247.6 |
Commercial property services fees | - | - | 91.1 | 0.7 | 91.8 |
Survey and valuation fees | - | - | 119.4 | (7.4) | 112.0 |
Asset management commission | - | - | 21.0 | - | 21.0 |
Conveyancing fees | - | - | 65.6 | (1.0) | 64.6 |
Financial advice fees | 33.0 | - | - | 0.9 | 33.9 |
Software and consultancy fees | - | - | - | 16.8 | 16.8 |
Factoring and invoice discounting services | - | - | - | 15.5 | 15.5 |
Other fees and commissions | 0.1 | - | 13.0 | - | 13.1 |
Fees and commissions receivable | 36.0 | 0.3 | 1,056.2 | 23.0 | 1,115.5 |
Fees and commissions payable and other operating income | 7.9 | - | (0.8) | (9.4) | (2.3) |
Net non -interest income | 43.9 | 0.3 | 1,055.4 | 13.6 | 1,113.2 |
^ As described in Note 47, the ‘Other’ category comprises segments that are not separately reportable, together with the impact of Group
consolidation adjustments. The Other category therefore includes amounts relating to all Group entities except for the Society, SIL and
Connells. Amounts relating to Group consolidation adjustments includes intra-group adjustments in relation to intercompany trading.
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Skipton Group Annual Report & Accounts 2025 184
Group | Society | |||
£m | 2025 | 2024 | 2025 | 2024 |
Realised profits / (losses) on treasury assets held at FVOCI | 0.3 | (1.8) | 0.3 | (1.8) |
Share of profits from joint ventures | 2.0 | 1.4 | - | - |
Profit on disposal of subsidiary undertakings | 10.8 | - | - | - |
Research and Development Expenditure Credit (RDEC) | 1.8 | - | 1.5 | - |
Other | 2.0 | 3.6 | 10.5 | 11.2 |
Total other operating income | 16.9 | 3.2 | 12.3 | 9.4 |
Group | Society | |||
£m | 2025 | 2024 | 2025 | 2024 |
Equity release portfolio (Note 18) | (14.5) | (12.6) | (14.5) | (12.6) |
Derivatives associated with equity release portfolio (Note 18) | 8.1 | 21.9 | 8.1 | 21.9 |
Equity share investments (Note 20e)) | 0.4 | 1.1 | - | - |
Share warrants | 5.6 | 5.9 | - | - |
Put options held by minority shareholders | (0.2) | (0.3) | - | - |
Hedging instruments and hedged items | 0.9 | 2.0 | 7.0 | 6.9 |
Loan to defined benefit pension scheme (Note 35) | (2.2) | - | (2.2) | - |
Other financial instruments | - | - | 3.3 | (4.0) |
Total | (1.9) | 18.0 | 1.7 | 12.2 |
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Skipton Group Annual Report & Accounts 2025 185
Group | Society | |||
£m | 2025 | 2024 | 2025 | 2024 |
Employee costs: | ||||
| Wages and salaries | 819.9 | 746.8 | 127.9 | 112.7 |
| Social security costs | 99.4 | 79.5 | 15.6 | 11.9 |
| Pension costs: | ||||
| Defined contribution arrangements (Note 36) | 32.8 | 28.6 | 9.3 | 8.2 |
952.1 | 854.9 | 152.8 | 132.8 | |
Other administrative expenses | 471.3 | 457.4 | 114.4 | 134.2 |
Central administrative costs recharged to Group undertakings | - | - | (4.8) | (5.0) |
Total administrative expenses | 1,423.4 | 1,312.3 | 262.4 | 262.0 |
Other administrative expenses comprise: | ||||
| Depreciation and amortisation (Notes 22, 23, 24 and 25) | 68.2 | 70.0 | 8.7 | 8.5 |
Impairment losses on property, plant and equipment, right-of-use assets, investment property and intangible assets | 5.6 | 3.1 | (0.1) | - |
| (Notes 22, 23, 24 and 25) | ||||
| Impairment losses on trade receivables (Note 45c)) | 1.4 | 0.8 | 0.1 | - |
| Lease expense – items exempt from IFRS 16: | ||||
| Short-term leases | 1.9 | 0.7 | 0.7 | 0.6 |
| Other property and establishment costs | 49.4 | 48.0 | 7.3 | 7.5 |
| Postage and communications | 8.3 | 6.9 | 8.0 | 6.6 |
| IT costs | 82.8 | 77.5 | 27.5 | 30.0 |
| Marketing and advertising | 75.6 | 69.6 | 17.4 | 15.6 |
| Insurance | 10.5 | 10.1 | 3.5 | 3.6 |
| Legal, professional and consultancy | 63.2 | 77.0 | 35.7 | 55.7 |
| Training, recruitment and other employee related costs | 61.9 | 59.7 | 5.3 | 5.4 |
| Costs of Connells' management incentive scheme (Note 32) | - | (4.2) | - | - |
| Other | 42.5 | 38.2 | 0.3 | 0.7 |
Total other administrative expenses | 471.3 | 457.4 | 114.4 | 134.2 |
Group | Society | |||||
£m | 2025 | 2024 | 2025 | 2024 | ||
Audit of the Society and Group Annual Accounts | 1.2 | 1.2 | 1.2 | 1.2 | ||
Audit of the Group’s subsidiary undertakings’ accounts pursuant to legislation | 2.6 | 2.5 | - | - | ||
Audit -related assurance services | 0.2 | 0.1 | 0.2 | 0.1 | ||
Other non -audit services | - | 0.1 | - | 0.1 | ||
Total external auditor remuneration | 4.0 | 3.9 | 1.4 | 1.4 |
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Skipton Group Annual Report & Accounts 2025 186
Group | Society | |||
£m | 2025 | 2024 | 2025 | 2024 |
Impairment (losses) / credits on loans and advances to customers | (10.1) | 17.1 | (9.8) | 17.0 |
(Note 17) | ||||
Impairment credits on liquid assets | 0.1 | 0.1 | 0.1 | 0.1 |
Realised losses on equity release portfolio (Note 18) | (1.3) | (1.8) | (1.3) | (1.8) |
Provisions for liabilities (Note 33) | (0.9) | (3.7) | 0.2 | (4.9) |
Total | (12.2) | 11.7 | (10.8) | 10.4 |
Group | Society | |||
2025 | 2024 | 2025 | 2024 | |
Society principal office | 2,123 | 2,001 | 2,123 | 2,001 |
Society branches | 452 | 423 | 452 | 423 |
Subsidiary undertakings | 16,279 | 15,592 | - | - |
Total employee numbers | 18,854 | 18,016 | 2,575 | 2,424 |
Directors’ emoluments are set out within the Directors’ Remuneration Report.
Total Directors’ emoluments for 2025 amounted to £3.1m (2024: £3.9m).
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Skipton Group Annual Report & Accounts 2025 187
| Group & Society | |||
£m | 2025 | 2024 | |
Salary, benefits and annual performance pay | 6.1 | 7.1 | |
Employer pension contributions | 0.6 | 0.3 | |
6.7 | 7.4 |
| Group & Society | |||
£’000 | 2025 | 2024 | |
Interest receivable | 18 | 29 | |
Interest payable | 41 | 37 |
| Group & Society | ||
£’000 | 2025 | 2024 |
Mortgage loans outstanding at 31 December | 1,603 | 643 |
Savings balances at 31 December | 1,219 | 1,327 |
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Skipton Group Annual Report & Accounts 2025 188
| Society | ||
£m | 2025 | 2024 |
Rendering and receiving of services | 0.1 | 0.1 |
Recharges of central costs | 4.8 | 5.0 |
Interest receivable (note A) | 130.7 | 122.6 |
Interest payable | (202.8) | (217.0) |
Mortgage referral, valuation and legal fees (note B) | (10.5) | (10.2) |
Other operating income | 9.6 | 8.2 |
Collateral transferred to funding vehicles | 2,194.4 | 1,147.2 |
Collateral transferred from funding vehicles | (54.3) | (67.0) |
Repayment of debt securities | (37.3) | (119.4) |
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Skipton Group Annual Report & Accounts 2025 189
Group | Society | |||
£m | 2025 | 2024 | 2025 | 2024 |
Profit before tax | 275.2 | 318.6 | 272.1 | 245.9 |
Share of profits from joint ventures, net of tax | (2.0) | (1.4) | - | - |
273.2 | 317.2 | 272.1 | 245.9 | |
Tax calculated at the standard rate of corporation tax in the UK of 25.0% (2024: 25.0%) | 68.3 | 79.3 | 68.0 | 61.5 |
Effects of: | ||||
| Expenses not deductible for tax purposes | 2.3 | 0.7 | 1.0 | 0.5 |
| Adjustment to tax expense in respect of prior periods | (0.2) | 0.5 | 0.5 | (0.6) |
| Non-taxable dividend income | - | - | (20.7) | (9.0) |
| Other non-taxable income | (3.5) | (1.8) | (0.4) | (0.2) |
| Lower tax rates in other jurisdictions | (1.7) | (4.4) | - | - |
| Banking surcharge | 2.3 | 3.3 | 2.6 | 3.3 |
| Recognition of previously unrecognised tax losses | - | (0.9) | - | - |
| Pillar Two top-up taxes | 0.7 | 1.5 | - | 1.5 |
Removal of deferred tax resulting from assets reclassified to ‘Assets held for sale’ | (1.8) | - | (1.8) | - |
| Other | (0.2) | (0.1) | 0.3 | (0.3) |
Total tax expense | 66.2 | 78.1 | 49.5 | 56.7 |
Group | Society | |||
£m | 2025 | 2024 | 2025 | 2024 |
Current tax: | ||||
| Corporation tax on profits in the period | 65.2 | 66.5 | 49.3 | 51.9 |
| Adjustments in respect of previous periods | (1.5) | 2.2 | 0.2 | 1.3 |
| Pillar Two top-up taxes | 0.7 | 1.5 | - | 1.5 |
64.4 | 70.2 | 49.5 | 54.7 | |
Deferred tax (Note 34): | ||||
| Current year charge / (credit) | 0.5 | 9.6 | (0.3) | 3.9 |
| Adjustments in respect of previous periods | 1.3 | (1.7) | 0.3 | (1.9) |
1.8 | 7.9 | - | 2.0 | |
Total tax expense | 66.2 | 78.1 | 49.5 | 56.7 |
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Skipton Group Annual Report & Accounts 2025 190
The effective tax rate for the Group for the year ended 31 December 2025 is 24.2% (2024: 24.6%) compared
with the standard rate of UK corporation tax of 25.0% (2024: 25.0%). The Group’s effective rate is lower than
the standard rate due to the impacts of non-taxable income and the lower tax rates in Guernsey and Jersey
which apply to the taxable profits of SIL. This is offset by the impact of the banking surcharge (see below),
additional tax due in respect of Pillar Two top-up taxes and expenditure disallowable for tax purposes.
The effective tax rate for the Society for the year ended 31 December 2025 is 18.2% (2024: 23.1%). The
Society’s taxable profits above £100m are subject to a 3% banking surcharge. The effective rate of tax is also
impacted by non-taxable dividend income of £82.8m (2024: £36.0m) and, for 2024, additional tax due in
respect of Pillar Two top-up taxes.
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Skipton Group Annual Report & Accounts 2025 191
Group | Society | |||
£m | 2025 | 2024 | 2025 | 2024 |
Gross carrying amount | 353.4 | 414.7 | 304.8 | 397.9 |
Loss allowance | (0.1) | (0.1) | (0.1) | (0.1) |
Net carrying amount | 353.3 | 414.6 | 304.7 | 397.8 |
Group | Society | |||
£m | 2025 | 2024 | 2025 | 2024 |
Repayable on demand: | ||||
| Cash and cash equivalents | 88.8 | 121.5 | 31.2 | 54.0 |
88.8 | 121.5 | 31.2 | 54.0 | |
In not more than three months: | ||||
| Cash and cash equivalents | - | 1.6 | - | - |
- | 1.6 | - | - | |
In more than three months but not more than one year: | ||||
| Other loans and advances to credit institutions | - | 1.0 | - | 1.0 |
- | 1.0 | - | 1.0 | |
No specified maturity: | ||||
| Cash pledged as collateral | 264.5 | 290.5 | 273.5 | 342.8 |
264.5 | 290.5 | 273.5 | 342.8 | |
Total loans and advances to credit institutions | 353.3 | 414.6 | 304.7 | 397.8 |
Total included within cash and cash equivalents | 88.8 | 123.1 | 31.2 | 54.0 |
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Skipton Group Annual Report & Accounts 2025 192
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Skipton Group Annual Report & Accounts 2025 193
| Group | 2025 | 2024 | ||
| £m | FVOCI and Total | FVOCI and Total | ||
Gilts | 500.5 | 1,086.5 | ||
Fixed rate bonds | 1,552.0 | 1,274.9 | ||
Floating rate notes | 11.0 | - | ||
Treasury bills | 773.4 | 598.2 | ||
Covered bonds | 813.5 | 770.1 | ||
Residential mortgage backed securities | 619.0 | 619.9 | ||
4,269.4 | 4,349.6 | |||
Debt securities have remaining maturities as follows: | ||||
| In not more than three months | 809.4 | 492.9 | ||
In more than three months but not more than one year | 253.6 | 826.3 | ||
| In more than one year but not more than five years | 2,536.5 | 2,222.1 | ||
| In more than five years | 669.9 | 808.3 | ||
4,269.4 | 4,349.6 | |||
Transferable debt securities comprise: | ||||
| Listed on a recognised investment exchange | 4,269.4 | 4,349.6 | ||
4,269.4 | 4,349.6 |
| Society | 2025 | 2024 | ||||
| £m | FVOCI | FVTPL | Total | FVOCI | FVTPL | Total |
Gilts | 500.5 | - | 500.5 | 1,086.5 | - | 1,086.5 |
Fixed rate bonds | 1,552.0 | - | 1,552.0 | 1,274.9 | - | 1,274.9 |
Treasury bills | 557.0 | - | 557.0 | 321.2 | - | 321.2 |
Covered bonds | 813.5 | - | 813.5 | 770.1 | - | 770.1 |
Residential mortgage backed securities | 778.9 | 73.5 | 852.4 | 817.1 | 70.3 | 887.4 |
4,201.9 | 73.5 | 4,275.4 | 4,269.8 | 70.3 | 4,340.1 | |
Debt securities have remaining maturities as follows: | ||||||
| In not more than three months | 593.1 | - | 593.1 | 273.9 | - | 273.9 |
In more than three months but not more than one year | 253.6 | - | 253.6 | 768.5 | - | 768.5 |
| In more than one year but not more than five years | 2,685.3 | 73.5 | 2,758.8 | 2,419.1 | 70.3 | 2,489.4 |
| In more than five years | 669.9 | - | 669.9 | 808.3 | - | 808.3 |
4,201.9 | 73.5 | 4,275.4 | 4,269.8 | 70.3 | 4,340.1 | |
Transferable debt securities comprise: | ||||||
| Listed on a recognised investment exchange | 4,201.9 | 73.5 | 4,275.4 | 4,269.8 | 70.3 | 4,340.1 |
4,201.9 | 73.5 | 4,275.4 | 4,269.8 | 70.3 | 4,340.1 |
Performance & Strategy Governance
Financial Statements
Other Information
Skipton Group Annual Report & Accounts 2025 194
| Group | 2025 | 2024 |
| £m | FVOCI and Total | FVOCI and Total |
At 1 January | 4,349.6 | 3,337.7 |
| Additions | 2,274.6 | 4,402.0 |
| Maturities and disposals | (2,416.3) | (3,376.3) |
| Changes in fair value | 49.2 | (28.5) |
| Other | 12.3 | 14.7 |
At 31 December | 4,269.4 | 4,349.6 |
| Society | 2025 | 2024 | ||||
| £m | FVOCI | FVTPL | Total | FVOCI | FVTPL | Total |
At 1 January | 4,269.8 | 70.3 | 4,340.1 | 3,143.4 | 63.1 | 3,206.5 |
| Additions | 1,410.3 | - | 1,410.1 | 3,908.8 | 77.8 | 3,986.6 |
| Maturities and disposals | (1,537.4) | - | (1,537.4) | (2,765.3) | (66.6) | (2,831.9) |
| Changes in fair value | 49.2 | 3.2 | 52.4 | (28.7) | (4.0) | (32.7) |
| Other | 10.0 | - | 10.0 | 11.6 | - | 11.6 |
At 31 December | 4,201.9 | 73.5 | 4,275.4 | 4,269.8 | 70.3 | 4,340.1 |
Group | Society | |||
£m | 2025 | 2024 | 2025 | 2024 |
Loss allowance at 1 January | 0.2 | 0.2 | 0.3 | 0.3 |
| Increases due to origination, acquisition and additions | 0.1 | 0.2 | 0.1 | 0.2 |
| Decrease due to derecognition, repayments and disposals | (0.1) | (0.2) | (0.1) | (0.2) |
Loss allowance at 31 December | 0.2 | 0.2 | 0.3 | 0.3 |
Group | Society | |||
£m | 2025 | 2024 | 2025 | 2024 |
Gilts | 8.0 | - | 8.0 | 201.1 |
Fixed rate bonds | 7.9 | 2.1 | 21.0 | 2.1 |
Treasury bills | 150.9 | - | 323.9 | - |
Total on -balance sheet debt securities pledged as collateral | 166.8 | 2.1 | 352.9 | 203.2 |
Performance & Strategy Governance
Financial Statements
Other Information
Skipton Group Annual Report & Accounts 2025 195
| Group & Society | ||
£m | 2025 | 2024 |
Carrying value of assets | 619.0 | 619.9 |
Cumulative unrealised gains recognised in fair value reserve | (0.9) | (0.3) |
Maximum exposure to loss at 31 December | 618.1 | 619.6 |
Performance & Strategy Governance
Financial Statements
Other Information
Skipton Group Annual Report & Accounts 2025 196
Group | Society | |||
£m | 2025 | 2024 | 2025 | 2024 |
Loans fully secured on residential property | 32,985.9 | 30,529.3 | 30,970.3 | 28,497.0 |
Loans fully secured on land | 89.6 | 109.6 | 89.6 | 109.6 |
Other lending: | ||||
| Debt factoring advances | 199.2 | 188.6 | - | - |
| Other loans | 45.3 | 48.2 | 0.5 | - |
Fair value adjustment for hedged risk | 58.9 | (274.6) | 60.9 | (271.7) |
33,378.9 | 30,601.1 | 31,121.3 | 28,334.9 | |
The remaining maturity of loans and advances to customers from the reporting date is as follows: | ||||
| On call and at short notice | 196.8 | 188.5 | 3.0 | 3.2 |
| In not more than three months | 27.1 | 28.9 | 26.8 | 28.9 |
In more than three months but not more than one year | 77.5 | 55.5 | 75.6 | 53.8 |
| In more than one year but not more than five years | 995.3 | 943.4 | 988.7 | 906.2 |
| In more than five years | 32,107.8 | 29,404.4 | 30,050.7 | 27,360.3 |
33,404.5 | 30,620.7 | 31,144.8 | 28,352.4 | |
Less: Impairment (Note 17) | (25.6) | (19.6) | (23.5) | (17.5) |
33,378.9 | 30,601.1 | 31,121.3 | 28,334.9 |
Performance & Strategy Governance
Financial Statements
Other Information
Skipton Group Annual Report & Accounts 2025 197
Performance & Strategy Governance
Financial Statements
Other Information
Skipton Group Annual Report & Accounts 2025 198
| Group | ||||
Loans fully secured | Loans fully | Other loans | ||
| £m | on residential | secured on | and | Total |
| Property | land | advances | ||
Loss allowance at 1 January 2025 | 13.5 | 4.7 | 1.4 | 19.6 |
Amounts written off during the year, net of recoveries | (1.5) | (2.4) | (0.2) | (4.1) |
| Income statement charge for the year | 9.6 | 0.3 | 0.2 | 10.1 |
Loss allowance at 31 December 2025 | 21.6 | 2.6 | 1.4 | 25.6 |
| Group | ||||
Loans fully secured | Loans fully | Other loans | ||
| £m | on residential | secured on | and | Total |
| Property | land | advances | ||
Loss allowance at 1 January 2024 | 29.0 | 9.0 | 1.6 | 39.6 |
Amounts written off during the year, net of recoveries | (1.0) | (1.4) | (0.5) | (2.9) |
| Income statement (credit) / charge for the year | (14.5) | (2.9) | 0.3 | (17.1) |
Loss allowance at 31 December 2024 | 13.5 | 4.7 | 1.4 | 19.6 |
| Society | ||||
| Loans fully secured | Loans fully | |||
| £m | on residential | secured on | Total | |
| Property | land | |||
Loss allowance at 1 January 2025 | 12.8 | 4.7 | 17.5 | |
Amounts written off during the year, net of recoveries | (1.4) | (2.4) | (3.8) | |
| Income statement charge for the year | 9.5 | 0.3 | 9.8 | |
Loss allowance at 31 December 2025 | 20.9 | 2.6 | 23.5 |
| Society | ||||
| Loans fully secured | Loans fully | |||
| £m | on residential | secured on | Total | |
| Property | Land | |||
Loss allowance at 1 January 2024 | 27.9 | 9.0 | 36.9 | |
Amounts written off during the year, net of recoveries | (1.0) | (1.4) | (2.4) | |
| Income statement credit for the year | (14.1) | (2.9) | (17.0) | |
Loss allowance at 31 December 2024 | 12.8 | 4.7 | 17.5 |
Performance & Strategy Governance
Financial Statements
Other Information
Skipton Group Annual Report & Accounts 2025 199
| Group & Society | |||
£m | 2025 | 2024 | |
At 1 January | 277.2 | 293.3 | |
| Redemptions | (4.0) | (4.3) | |
| Movements in fair value | (14.5) | (12.6) | |
| Realised losses on redemption | (1.3) | (1.8) | |
| Accrued interest | 5.7 | 2.6 | |
At 31 December | 263.1 | 277.2 |
| Group & Society | |||
£m | 2025 | 2024 | |
At 1 January | 0.9 | 0.9 | |
| Repayments | (0.2) | (0.1) | |
| Accrued interest | 0.1 | 0.1 | |
At 31 December | 0.8 | 0.9 |
Performance & Strategy Governance
Financial Statements
Other Information
Skipton Group Annual Report & Accounts 2025 200
| Society | |||
| £m | Shares in subsidiary | Loans to subsidiary | Total |
| undertakings | undertakings | ||
Cost | |||
At 1 January | 183.5 | 403.9 | 587.4 |
| Additions | - | 60.3 | 60.3 |
| Repayments | - | (9.5) | (9.5) |
At 31 December | 183.5 | 454.7 | 638.2 |
Provisions | |||
At 1 January | 78.1 | - | 78.1 |
At 31 December | 78.1 | - | 78.1 |
Net book value at 31 December | 105.4 | 454.7 | 560.1 |
| Society | |||
| £m | Shares in subsidiary | Loans to subsidiary | Total |
| undertakings | undertakings | ||
Cost | |||
At 1 January | 183.5 | 372.7 | 556.2 |
| Additions | - | 37.1 | 37.1 |
| Repayments | - | (5.9) | (5.9) |
At 31 December | 183.5 | 403.9 | 587.4 |
Provisions | |||
At 1 January | 78.1 | - | 78.1 |
At 31 December | 78.1 | - | 78.1 |
Net book value at 31 December | 105.4 | 403.9 | 509.3 |
Performance & Strategy Governance
Financial Statements
Other Information
Skipton Group Annual Report & Accounts 2025 201
| Ownership Interest (%) | ||||
| Name of subsidiary | Principal business activity | Registered office | 2025 | 2024 |
| undertaking | ||||
Connells Limited and | Estate agency and related | Cumbria House, 16 -20 Hockliffe | ||
subsidiary undertakings | businesses | Street, Leighton Buzzard, | 100 | 100 |
Bedfordshire, LU71GN | ||||
Darrowby No. 6 plc | Funding vehicle | 10 th Floor, 5 Churchill Place, | (See below) | (See below) |
London, E14 5HU | ||||
Jade Software Corporation | Provider of software | 5 Sir Gil Simpson Drive, | ||
Limited and subsidiary | development services | Christchurch 8053, New Zealand | 100 | 100 |
undertakings | ||||
Skipton Business Finance | Provider of debt factoring | The Bailey, Skipton, North | 100 | 100 |
Limited (SBF) | services | Yorkshire, BD23 1DN | ||
Skipton Covered Bonds | Mortgage acquisition and | The Bailey, Skipton, North | (See below) | (See below) |
Limited Liability Partnership | guarantor of covered bonds | Yorkshire, BD23 1DN | ||
Skipton Financial Services | Financial adviser | The Bailey, Skipton, North | 100 | 100 |
Limited | Yorkshire, BD23 1DN | |||
Skipton Group Holdings | Intermediate holding | The Bailey, Skipton, North | 100 | 100 |
Limited (SGHL) | company | Yorkshire, BD23 1DN | ||
Skipton International | Offshore deposit taker and | Tudor House, Le Bordage, St Peter | 100 | 100 |
Limited (SIL) | lender | Port, Guernsey, GY1 6DS | ||
Skipton Trustees Limited | Estate administration | The Bailey, Skipton, North | 100 | 100 |
services | Yorkshire, BD23 1DN |
Performance & Strategy Governance
Financial Statements
Other Information
Skipton Group Annual Report & Accounts 2025 202
Performance & Strategy Governance Financial Statements
Other Information
£m | Book value | FV | Accounting | Fair value |
| adjustments | adjustments | |||
| Assets | ||||
| Loans and advances to credit institutions (note A) | 8.7 | - | - | 8.7 |
| Trade and other receivables (note B) | 10.9 | (0.2) | (0.3) | 10.4 |
| Property, plant and equipment | 0.6 | - | - | 0.6 |
| Right-of-use assets (note C) | - | - | 3.8 | 3.8 |
| Intangible assets (note D) | - | 13.9 | - | 13.9 |
| Total assets | 20.2 | 13.7 | 3.5 | 37.4 |
| Liabilities | ||||
| Trade and other payables | 7.7 | - | 0.3 | 8.0 |
| Provisions | 1.2 | - | 0.1 | 1.3 |
| Deferred tax liabilities (note E) | - | 3.7 | - | 3.7 |
| Lease liabilities (note C) | - | - | 3.7 | 3.7 |
| Total liabilities | 8.9 | 3.7 | 4.1 | 16.7 |
| Net assets / (liabilities) | 11.3 | 10.0 | (0.6) | 20.7 |
| Fair value of net assets | 20.7 | |||
| Non-controlling interest (note F) | (3.3) | |||
| Goodwill arising on acquisition (note G) | 30.8 | |||
| Total consideration | 48.2 |
Skipton Group Annual Report & Accounts 2025 203
Performance & Strategy Governance Financial Statements
Other Information
Skipton Group Annual Report & Accounts 2025 204
| Group | ||
£m | 2025 | 2024 |
Unlisted investments | 18.3 | 16.9 |
Total | 18.3 | 16.9 |
Ownership Interest (%) | Carrying Value (£m) | |||||
Name of investment | Principle Business Activity | Class of shares held | 2025 | 2024 | 2025 | 2024 |
Cybele Solutions | Conveyancing services | Ordinary | 50.0 | 50.0 | 13.2 | 11.2 |
Holdings Limited* |
Performance & Strategy Governance Financial Statements
Other Information
Group | Society | |||||||
£m | 2025 | 2024 | 2025 | 2024 | ||||
Assets held for sale | 3.7 | - | 3.7 | - |
Skipton Group Annual Report & Accounts 2025 205
2025 | 2024 | |||||
| Group | Land and | Equipment, | Land and | Equipment, | ||
| £m | buildings | fixtures | Total | buildings | fixtures | Total |
and fittings | and fittings | |||||
Cost | ||||||
At 1 January | 115.6 | 93.9 | 209.5 | 110.8 | 87.9 | 198.7 |
| Additions | 6.4 | 7.5 | 13.9 | 8.9 | 13.1 | 22.0 |
| Disposals | (1.2) | (7.5) | (8.7) | (3.7) | (6.9) | (10.6) |
| Acquisition of subsidiary undertakings | 0.1 | 0.5 | 0.6 | - | - | - |
Foreign exchange movements on translation | - | - | - | - | (0.2) | (0.2) |
| Reclassification to assets held for sale | (0.8) | - | (0.8) | - | - | - |
Reclassification to investment property | (0.1) | - | (0.1) | (0.4) | - | (0.4) |
At 31 December | 120.0 | 94.4 | 214.4 | 115.6 | 93.9 | 209.5 |
Depreciation | ||||||
At 1 January | 61.0 | 67.6 | 128.6 | 58.4 | 65.8 | 124.2 |
| Charge for the year | 6.4 | 9.0 | 15.4 | 5.9 | 8.4 | 14.3 |
| Impairment charge | - | 1.0 | 1.0 | - | - | - |
| Disposals | (0.9) | (6.5) | (7.4) | (3.2) | (6.4) | (9.6) |
Foreign exchange movements on translation | - | (0.1) | (0.1) | - | (0.2) | (0.2) |
| Reclassification to assets held for sale | (0.2) | - | (0.2) | - | - | - |
Reclassification to investment property | - | - | - | (0.1) | - | (0.1) |
At 31 December | 66.3 | 71.0 | 137.3 | 61.0 | 67.6 | 128.6 |
Net book value at 1 January | 54.6 | 26.3 | 80.9 | 52.4 | 22.1 | 74.5 |
Net book value at 31 December | 53.7 | 23.4 | 77.1 | 54.6 | 26.3 | 80.9 |
2025 | 2024 | |||||
| Society | Land and | Equipment, | Land and | Equipment, | ||
| £m | buildings | fixtures | Total | buildings | fixtures | Total |
and fittings | and fittings | |||||
Cost | ||||||
At 1 January | 57.1 | 21.5 | 78.6 | 55.1 | 17.5 | 72.6 |
| Additions | 3.0 | 3.2 | 6.2 | 4.5 | 6.0 | 10.5 |
| Disposals | (0.6) | (0.7) | (1.3) | (2.1) | (2.0) | (4.1) |
| Reclassification to assets held for sale | (0.8) | - | (0.8) | - | - | - |
Reclassification to investment property | (0.1) | - | (0.1) | (0.4) | - | (0.4) |
At 31 December | 58.6 | 24.0 | 82.6 | 57.1 | 21.5 | 78.6 |
Depreciation | ||||||
At 1 January | 23.6 | 11.9 | 35.5 | 22.6 | 11.0 | 33.6 |
| Charge for the year | 2.8 | 3.5 | 6.3 | 2.8 | 2.9 | 5.7 |
| Disposals | (0.6) | (0.7) | (1.3) | (1.7) | (2.0) | (3.7) |
| Reclassification to assets held for sale | (0.2) | - | (0.2) | - | - | - |
Reclassification to investment property | - | - | - | (0.1) | - | (0.1) |
At 31 December | 25.6 | 14.7 | 40.3 | 23.6 | 11.9 | 35.5 |
Net book value at 1 January | 33.5 | 9.6 | 43.1 | 32.5 | 6.5 | 39.0 |
Net book value at 31 December | 33.0 | 9.3 | 42.3 | 33.5 | 9.6 | 43.1 |
Performance & Strategy Governance
Financial Statements
Other Information
Skipton Group Annual Report & Accounts 2025 206
Group | Society | |||
£m | 2025 | 2024 | 2025 | 2024 |
Freehold | 36.7 | 38.3 | 25.0 | 25.6 |
Long leasehold | 2.6 | 2.7 | 2.6 | 2.7 |
Short leasehold | 14.4 | 13.6 | 5.4 | 5.2 |
Total | 53.7 | 54.6 | 33.0 | 33.5 |
Performance & Strategy Governance
Financial Statements
Other Information
Skipton Group Annual Report & Accounts 2025 207
2025 | 2024 | |||||
| Group | Land and | Equipment, | Land and | Equipment, | ||
| £m | buildings | fixtures | Total | buildings | fixtures | Total |
and fittings | and fittings | |||||
Cost | ||||||
Balance at 1 January | 163.8 | 22.6 | 186.4 | 160.4 | 21.3 | 181.7 |
| Additions | 25.2 | 15.7 | 40.9 | 17.1 | 2.2 | 19.3 |
| Acquisition of subsidiary undertakings | 4.0 | - | 4.0 | - | - | - |
Lease modifications and remeasurements | 13.7 | 1.0 | 14.7 | 11.2 | - | 11.2 |
| Disposals | (30.6) | (0.2) | (30.8) | (24.7) | (0.9) | (25.6) |
Foreign exchange movements on translation | (0.1) | - | (0.1) | (0.2) | - | (0.2) |
At 31 December | 176.0 | 39.1 | 215.1 | 163.8 | 22.6 | 186.4 |
Depreciation | ||||||
Balance at 1 January | 81.3 | 14.7 | 96.0 | 70.9 | 9.9 | 80.8 |
| Charge for the year | 32.3 | 7.0 | 39.3 | 32.1 | 5.6 | 37.7 |
| Impairment charge | 1.8 | 0.1 | 1.9 | 2.3 | 0.1 | 2.4 |
| Disposals | (28.8) | (0.2) | (29.0) | (23.8) | (0.9) | (24.7) |
Foreign exchange movements on translation | (0.1) | - | (0.1) | (0.2) | - | (0.2) |
At 31 December | 86.5 | 21.6 | 108.1 | 81.3 | 14.7 | 96.0 |
Net book value at 1 January | 82.5 | 7.9 | 90.4 | 89.5 | 11.4 | 100.9 |
Net book value at 31 December | 89.5 | 17.5 | 107.0 | 82.5 | 7.9 | 90.4 |
2025 | 2024 | |||||
| Society | Land and | Equipment, | Land and | Equipment, | ||
| £m | buildings | fixtures | Total | buildings | fixtures | Total |
and fittings | and fittings | |||||
Cost | ||||||
At 1 January | 18.9 | - | 18.9 | 18.9 | 0.2 | 19.1 |
| Additions | 1.8 | - | 1.8 | 0.8 | - | 0.8 |
| Disposals | (2.8) | - | (2.8) | (0.8) | (0.2) | (1.0) |
At 31 December | 17.9 | - | 17.9 | 18.9 | - | 18.9 |
Depreciation | ||||||
At 1 January | 10.6 | - | 10.6 | 9.0 | 0.1 | 9.1 |
| Charge for the year | 2.1 | - | 2.1 | 2.2 | - | 2.2 |
| Disposals | (2.8) | - | (2.8) | (0.6) | (0.1) | (0.7) |
At 31 December | 9.9 | - | 9.9 | 10.6 | - | 10.6 |
Net book value at 1 January | 8.3 | - | 8.3 | 9.9 | 0.1 | 10.0 |
Net book value at 31 December | 8.0 | - | 8.0 | 8.3 | - | 8.3 |
Performance & Strategy Governance
Financial Statements
Other Information
Skipton Group Annual Report & Accounts 2025 208
| Group & Society | ||
£m | 2025 | 2024 |
Cost | ||
At 1 January | 25.1 | 25.1 |
| Additions | 0.1 | - |
| Disposals | (0.1) | (0.4) |
| Reclassification to assets held for sale | (22.8) | - |
| Reclassification from property, plant and equipment | 0.1 | 0.4 |
At 31December | 2.4 | 25.1 |
Depreciation | ||
At 1 January | 20.6 | 20.0 |
| Charge for the year | 0.3 | 0.6 |
| Impairment credit | (0.1) | - |
| Disposals | (0.1) | (0.1) |
| Reclassification to assets held for sale | (19.7) | - |
| Reclassification from property, plant and equipment | - | 0.1 |
At 31 December | 1.0 | 20.6 |
Net book value at 1 January | 4.5 | 5.1 |
Net book value at 31 December | 1.4 | 4.5 |
| Group & Society | |||
£m | 2025 | 2024 | |
Market value of investment property | 2.1 | 5.4 |
Performance & Strategy Governance
Financial Statements
Other Information
Skipton Group Annual Report & Accounts 2025 209
Group | Society | ||||
£m | 2025 | 2024 | 2025 | 2024 | |
Goodwill | 249.9 | 218.5 | - | - | |
Other intangible assets | 127.7 | 92.9 | 8.3 | 4.2 | |
Total intangible assets | 377.6 | 311.4 | 8.3 | 4.2 |
| Group | ||
£m | 2025 | 2024 |
Cost, less amortisation to 1 January 2004 | ||
At 1 January | 231.0 | 230.2 |
| Acquisitions of subsidiary undertakings and business units (Note 20b)) | 33.2 | 0.5 |
| Revaluation of put options | 0.8 | 0.3 |
| Disposal of subsidiary undertakings | (2.6) | - |
At 31 December | 262.4 | 231.0 |
Impairment losses | ||
At 1 January | 12.5 | 12.5 |
At 31 December | 12.5 | 12.5 |
Net book value at 1 January | 218.5 | 217.7 |
Net book value at 31 December | 249.9 | 218.5 |
2025 (£m) | 2024 (£m) | |||||
Operating Segment | Cost of | Accumulated | Carrying | Cost of | Accumulated | Carrying |
| goodwill | impairment | value | goodwill | impairment | value | |
Connells | 244.9 | 7.5 | 237.4 | 219.7 | 7.5 | 212.2 |
Other | 17.5 | 5.0 | 12.5 | 11.3 | 5.0 | 6.3 |
Total goodwill | 262.4 | 12.5 | 249.9 | 231.0 | 12.5 | 218.5 |
Performance & Strategy Governance
Financial Statements
Other Information
Skipton Group Annual Report & Accounts 2025 210
Operating Segment | Key drivers |
Connells | Volume of UK property transactions, house price inflation, level of unemployment and |
interest rates | |
Other | Volume of new business, arrears levels, level of unemployment and interest rates |
Operating Segment | 2025 (%) | 2024 (%) |
Connells | 16 | 17 |
Other | 12 | 12 |
Performance & Strategy Governance
Financial Statements
Other Information
Skipton Group Annual Report & Accounts 2025 211
Group | Society | ||||
£m | 2025 | 2024 | 2025 | 2024 | |
Cost | |||||
At 1 January | 272.8 | 260.1 | 5.3 | 1.3 | |
| Acquisition of subsidiary undertakings | 16.0 | - | - | - | |
| Acquisition of other business assets | 1.4 | 1.1 | - | - | |
| Additions | 33.8 | 14.9 | 4.1 | 4.0 | |
| Foreign exchange movements on translation | (1.4) | (3.1) | - | - | |
| Disposals | (0.8) | (0.2) | - | - | |
| Disposal of subsidiaries | (1.7) | - | - | - | |
At 31 December | 320.1 | 272.8 | 9.4 | 5.3 | |
Amortisation and impairment | |||||
At 1 January | 179.9 | 164.6 | 1.1 | 1.1 | |
| Amortisation charge for the year | 13.2 | 17.4 | - | - | |
| Impairment charge | 2.8 | 0.7 | - | - | |
| Foreign exchange movements on translation | (1.0) | (2.6) | - | - | |
| Disposals | (0.8) | (0.2) | - | - | |
| Disposal of subsidiaries | (1.7) | - | - | - | |
At 31 December | 192.4 | 179.9 | 1.1 | 1.1 | |
Net book value at 1 January | 92.9 | 95.5 | 4.2 | 0.2 | |
Net book value at 31 December | 127.7 | 92.9 | 8.3 | 4.2 |
Group | Society | ||||
£m | 2025 | 2024 | 2025 | 2024 | |
Brands | 65.7 | 61.2 | - | - | |
Customer contracts and relationships | 11.0 | 10.5 | - | - | |
Computer software and databases | 51.0 | 21.2 | 8.3 | 4.2 | |
Total | 127.7 | 92.9 | 8.3 | 4.2 |
£m | ||
Performance & Strategy Governance
Financial Statements
Other Information
Skipton Group Annual Report & Accounts 2025 212
Group | Society | |||
£m | 2025 | 2024 | 2025 | 2024 |
Trade receivables (Note 45c)) | 73.6 | 68.8 | 1.5 | 1.9 |
Prepayments | 40.4 | 33.6 | 19.7 | 16.2 |
Accrued income | 27.9 | 24.7 | 2.4 | 0.1 |
Equity share investments mandatorily held at FVTPL | 18.3 | 16.9 | - | - |
(Note 20e)) | ||||
Share warrants | - | 21.9 | - | - |
Investment property (Note 24) | 1.4 | 4.5 | 1.4 | 4.5 |
Other | 16.1 | 10.8 | 1.5 | 0.2 |
177.7 | 181.2 | 26.5 | 22.9 |
Group | Society | |||
£m | 2025 | 2024 | 2025 | 2024 |
Held by individuals | 30,167.9 | 27,943.5 | 30,167.9 | 27,943.5 |
Other shares | 301.9 | 326.8 | 301.9 | 326.8 |
Fair value adjustment for hedged risk | 56.5 | (1.8) | 54.5 | (16.2) |
30,526.3 | 28,268.5 | 30,524.3 | 28,254.1 |
Group | Society | |||
£m | 2025 | 2024 | 2025 | 2024 |
Amounts owed to subsidiary undertakings | - | - | 186.0 | 201.0 |
Other | 327.2 | 1,599.6 | 327.1 | 1,599.6 |
327.2 | 1,599.6 | 513.1 | 1,800.6 |
Group | Society | |||
£m | 2025 | 2024 | 2025 | 2024 |
Amounts owed to subsidiary undertakings | - | - | 1,118.1 | 1,212.7 |
Other | 2,719.6 | 2,751.1 | 53.8 | 56.2 |
2,719.6 | 2,751.1 | 1,171.9 | 1,268.9 |
Performance & Strategy Governance
Financial Statements
Other Information
Skipton Group Annual Report & Accounts 2025 213
Group | Society | |||
£m | 2025 | 2024 | 2025 | 2024 |
Certificates of deposit | - | 5.1 | - | 5.1 |
Covered bonds | 2,941.3 | 1,934.9 | 2,955.0 | 1,925.0 |
Securitisation | 398.3 | 491.6 | - | - |
Fair value adjustment for hedged risk | 22.3 | 3.7 | - | - |
3,361.9 | 2,435.3 | 2,955.0 | 1,930.1 |
Group | Society | |||
£m | 2025 | 2024 | 2025 | 2024 |
At 1 January | 92.1 | 103.0 | 8.6 | 10.3 |
| Additions | 40.7 | 18.1 | 1.7 | 0.7 |
| Acquisition of subsidiary undertakings | 4.0 | - | - | - |
| Modifications / remeasurements of existing lease | 14.7 | 11.2 | - | - |
| Liabilities | ||||
| Interest charged | 4.6 | 3.1 | 0.3 | 0.3 |
| Lease payments (including interest) | (43.9) | (42.4) | (2.4) | (2.6) |
| Disposals | (1.9) | (0.9) | - | (0.1) |
At 31 December | 110.3 | 92.1 | 8.2 | 8.6 |
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Skipton Group Annual Report & Accounts 2025 214
| Group | ||
£m | 2025 | 2024 |
At 1 January | 4.1 | 3.5 |
| Additions | 0.1 | - |
| Exercise of put options by non-controlling shareholders | (4.2) | - |
| Revaluation of market values and changes to future exercise dates | 1.0 | 0.6 |
At 31 December | 1.0 | 4.1 |
Group | Society | |||
£m | 2025 | 2024 | 2025 | 2024 |
Trade payables | 14.4 | 11.0 | 3.4 | 2.8 |
Fair value of put option obligation | 1.0 | 4.1 | - | - |
VAT and employment taxes | 50.0 | 39.5 | 3.9 | 3.0 |
Other | 43.9 | 32.0 | 5.3 | 5.2 |
109.3 | 86.6 | 12.6 | 11.0 |
Performance & Strategy Governance
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Other Information
Skipton Group Annual Report & Accounts 2025 215
| 2025 | ||||||||||
Provision for | Survey and | |||||||||
Group | the costs of | Commission | valuation | Customer | Other | Total | ||||
£m | surplus | clawbacks | claims | compensation | provisions | |||||
| properties | ||||||||||
At 1 January | 4.0 | 17.9 | 3.7 | 0.6 | 5.6 | 31.8 | ||||
Acquired on acquisition of subsidiaries | 0.1 | - | 0.2 | - | - | 0.3 | ||||
| Disposal of subsidiary | - | (0.1) | - | - | - | (0.1) | ||||
| undertakings | ||||||||||
Charge for the year | A | 0.3 | 15.5 | B | A | 0.5 | - | 0.1 A | 16.4 | |
| Utilised during the year | (0.5) | (14.5) | (0.6) | - | (0.2) | (15.8) | ||||
At 31 December | 3.9 | 18.8 | 3.8 | 0.6 | 5.5 | 32.6 | ||||
| 2024 | ||||||
Provision for | Survey and | |||||
Group | the costs of | Commission | valuation | Customer | Other | Total |
£m | surplus | clawbacks | claims | compensation | provisions | |
| properties | ||||||
At 1 January | 5.6 | 17.0 | 5.2 | 0.3 | 1.3 | 29.4 |
(Credit) / charge for the year | (0.5) A | 8.9 B | (0.8) A | 0.4 A | 4.5 A | 12.5 |
| Utilised during the year | (1.1) | (8.0) | (0.7) | (0.1) | (0.2) | (10.1) |
At 31 December | 4.0 | 17.9 | 3.7 | 0.6 | 5.6 | 31.8 |
| 2025 | ||||||
Society | Provision for the | Commission | Customer | Other | ||
£m | costs of surplus | clawbacks | compensation | provisions | Total | |
| properties | ||||||
At 1 January | - | - | 0.5 | 4.8 | 5.3 | |
| Credit for the year | - | - | - | (0.2) A | (0.2) | |
At 31 December | - | - | 0.5 | 4.6 | 5.1 |
| 2024 | ||||||
Society | Provision for the | Commission | Customer | Other | ||
£m | costs of surplus | clawbacks | compensation | provisions | Total | |
| properties | ||||||
At 1 January | 0.1 | - | 0.3 | 0.2 | 0.6 | |
(Credit) / charge for the year | (0.1) A | 0.1 A | 0.3 A | 4.6 A | 4.9 | |
| Utilised during the year | - | (0.1) | (0.1) | - | (0.2) | |
At 31 December | - | - | 0.5 | 4.8 | 5.3 |
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Other Information
Skipton Group Annual Report & Accounts 2025 216
Performance & Strategy Governance
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Other Information
Skipton Group Annual Report & Accounts 2025 217
Group | Society | |||
£m | 2025 | 2024 | 2025 | 2024 |
Net deferred tax asset at 1 January | 6.3 | 20.9 | 11.2 | 16.7 |
| Income Statement charge (Note 12) | (1.8) | (7.9) | - | (2.0) |
| Items taken directly to other comprehensive income | (0.2) | (6.5) | (5.1) | (3.5) |
| Acquired on acquisition of subsidiaries | (4.1) | - | - | - |
| Acquired on acquisition of other business assets | (0.3) | (0.2) | - | - |
| Other movements | (0.1) | - | 0.1 | - |
Net deferred tax (liability) / asset at 31 December | (0.2) | 6.3 | 6.2 | 11.2 |
Group | Society | |||
£m | 2025 | 2024 | 2025 | 2024 |
Fixed asset temporary differences | - | 3.8 | (1.6) | (3.0) |
Intangible asset temporary differences | (1.9) | (15.7) | - | - |
Derivatives and loans (note B) | - | 6.0 | 3.1 | 4.6 |
Pension obligations | - | 5.6 | 3.3 | 3.5 |
Provisions | 0.2 | 6.8 | 2.7 | 2.5 |
Corporation tax losses (note C) | 2.1 | 2.1 | - | - |
Financial assets held at FVOCI | - | 4.2 | 2.4 | 4.1 |
Cash flow hedges | - | (6.4) | (3.7) | (0.5) |
Cost of hedging reserve | - | 0.6 | - | - |
Gain deferred by rollover relief | - | (0.7) | - | - |
Total | 0.4 | 6.3 | 6.2 | 11.2 |
Performance & Strategy Governance
Financial Statements
Other Information
Group | Society | ||||
£m | 2025 | 2024 | 2025 | 2024 | |
Fixed asset temporary differences | (4.1) | - | - | - | |
Intangible asset temporary differences | 22.8 | - | - | - | |
Derivatives and loans (note B) | (7.3) | - | - | - | |
Pension obligations | (4.8) | - | - | - | |
Provisions | (6.9) | - | - | - | |
Corporation tax losses (note C) | (0.2) | - | - | - | |
Financial assets held at FVOCI | (2.5) | - | - | - | |
Cash flow hedges | 3.8 | - | - | - | |
Cost of hedging reserve | (0.2) | - | - | - | |
Total | 0.6 | - | - | - | |
Overall net deferred tax (liability) / asset | (0.2) | 6.3 | 6.2 | 11.2 |
Skipton Group Annual Report & Accounts 2025 218
Group | Society | |||
£m | 2025 | 2024 | 2025 | 2024 |
Fixed asset temporary differences | 0.1 | 3.0 | (1.3) | 1.2 |
Intangible asset temporary differences | 4.2 | (1.8) | - | - |
Provisions | (0.3) | (0.4) | (0.2) | (0.7) |
Derivatives and loans | (1.3) | 1.6 | 1.5 | 1.5 |
Corporation tax losses | (0.2) | 3.9 | - | - |
Tax losses on IFRS 16 transitional adjustments | - | 1.7 | - | - |
Other | (0.7) | (0.1) | - | - |
Total | 1.8 | 7.9 | - | 2.0 |
Performance & Strategy Governance
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Other Information
Skipton Group Annual Report & Accounts 2025 219
Performance & Strategy Governance
Financial Statements
Other Information
Skipton Group Annual Report & Accounts 2025 220
Performance & Strategy Governance
Financial Statements
Other Information
Skipton Group Annual Report & Accounts 2025 221
| Valuation | Deficit | Recovery | Annual | |
| Scheme | date | £m | period | contribution 2026 |
| (estimate) £m | ||||
Skipton (2015) | 31 December 2022 | (24.5) | - | - |
Connells (2014) | 30 April 2023 | (18.4) | 6 years and 9 | 3.0 |
| months | ||||
Countrywide | 4 April 2021 | (4.5) | - | - |
Performance & Strategy Governance
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Other Information
Skipton Group Annual Report & Accounts 2025 222
| Group & Society | |||
2025 | 2024 | ||
Retail Price Inflation (RPI) | 3.00 | 3.20 | |
Consumer Price Inflation (CPI) | 2.55 | 2.75 | |
Discount rate | 5.60 | 5.55 | |
Increases to pension payment: | |||
| in line with RPI, subject to a max of 5% pa | 2.85 | 3.03 | |
| in line with RPI, subject to a min of 3% and max of 5% pa | 3.53 | 3.69 | |
| in line with RPI, subject to a max of 2.5% pa | 2.02 | 2.00 | |
| in line with CPI, subject to a max of 5% pa | 2.48 | 2.69 | |
| in line with CPI, subject to a min of 3% and max of 5% pa | 3.38 | 3.52 | |
| in line with CPI, subject to a max of 3% pa | 2.07 | 2.13 | |
| in line with CPI, subject to a max of 2.5% pa | 1.85 | 1.87 | |
| Fixed 4.00% pa | 4.00 | 4.00 | |
Rate of increase for deferred pensions (in line with CPI, subject to a max of 5% pa) | 2.55 | 2.75 | |
Allowance for commutation of pension for cash at retirement | 82% of post A | 82% of post A | |
day maximum | day maximum |
| Group & Society | ||
2025 | 2024 | |
Male retiring in the current year | 21.5 – 21.7 | 21.6 - 21.7 |
Female retiring in the current year | 23.6 – 23.7 | 23.6 |
Male retiring in 15 years' time | 22.4 – 22.5 | 22.4 - 22.6 |
Female retiring in 15 years' time | 24.7 – 24.8 | 24.6 - 24.7 |
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Other Information
Skipton Group Annual Report & Accounts 2025 223
Group | Society | |||
£m | 2025 | 2024 | 2025 | 2024 |
Within assets | ||||
Retirement benefit surplus | - | 4.8 | - | 4.8 |
Within liabilities | ||||
Retirement benefit obligations | (7.4) | (8.6) | (1.2) | - |
2025 | 2024 | ||||
Group | Retirement | Retirement Retirement | |||
£m | Benefit | Total | Benefit | Benefit | Total |
Obligation | Surplus | Obligation | |||
Fair value of plan assets | 158.5 | 158.5 | 91.9 | 103.5 | 195.4 |
Fair value of defined benefit obligation | (165.9) | (165.9) | (87.1) | (112.1) | (199.2) |
Net pensions (liability) / asset | (7.4) | (7.4) | 4.8 | (8.6) | (3.8) |
2025 | 2024 | |||
Society | Retirement | Retirement | ||
£m | Benefit | Total | Benefit Surplus | Total |
| Obligation | ||||
Fair value of plan assets | 85.2 | 85.2 | 91.9 | 91.9 |
Fair value of defined benefit obligation | (86.4) | (86.4) | (87.1) | (87.1) |
Net pensions (liability) / asset | (1.2) | (1.2) | 4.8 | 4.8 |
Performance & Strategy Governance
Financial Statements
Other Information
Skipton Group Annual Report & Accounts 2025 224
Group | Society | |||
£m | 2025 | 2024 | 2025 | 2024 |
At 1 January | 195.4 | 191.1 | 91.9 | 79.2 |
| Interest income | 10.8 | 10.0 | 5.5 | 4.8 |
| Return on plan assets (excluding amounts included | (19.0) | (21.5) | (17.9) | (11.0) |
| in interest income) | ||||
| Contributions by employer | 14.4 | 26.0 | 10.7 | 23.0 |
| Benefits paid | (11.6) | (10.2) | (5.0) | (4.1) |
| Settlements paid | (31.5) | - | - | - |
At 31 December | 158.5 | 195.4 | 85.2 | 91.9 |
Group | Society | |||
£m | 2025 | 2024 | 2025 | 2024 |
Diversified growth fund (note A) | 24.0 | 28.2 | 12.0 | 14.4 |
Insured pensioners (annuities) (note B) | 85.6 | 31.3 | 85.6 | - |
Liability driven investments (note C) | 52.1 | 125.0 | - | 76.2 |
Equities | 5.5 | 5.4 | - | - |
Cash (note D) | (10.9) | 2.9 | (12.4) | 1.3 |
Corporate bonds | 1.9 | 1.3 | - | - |
Government bonds | 0.3 | 1.3 | - | - |
Total | 158.5 | 195.4 | 85.2 | 91.9 |
Group | Society | |||
£m | 2025 | 2024 | 2025 | 2024 |
At 1 January | 199.2 | 217.3 | 87.1 | 95.1 |
| Interest expense | 10.3 | 9.9 | 4.7 | 4.4 |
| Remeasurement losses / (gains) arising from changes in: | ||||
| Scheme experience | 0.3 | 0.3 | 0.2 | - |
| Demographic assumptions | 1.7 | (0.5) | 0.8 | (0.2) |
| Financial assumptions | (2.5) | (17.6) | (1.4) | (8.1) |
| Actual benefit payments | (11.6) | (10.2) | (5.0) | (4.1) |
| Settlement payments | (31.5) | - | - | - |
At 31 December | 165.9 | 199.2 | 86.4 | 87.1 |
Performance & Strategy Governance
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Other Information
Skipton Group Annual Report & Accounts 2025 225
Performance & Strategy Governance
Financial Statements
Other Information
Skipton Group Annual Report & Accounts 2025 226
Group | Society | |||
£m | 2025 | 2024 | 2025 | 2024 |
Net interest expense | (0.5) | (0.1) | (0.8) | (0.4) |
Total recognised in Income Statement | (0.5) | (0.1) | (0.8) | (0.4) |
Performance & Strategy Governance
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Skipton Group Annual Report & Accounts 2025 227
Group | Society | |
£m | 2026 | 2026 |
Estimated employer contributions | ||
Ongoing | 3.0 | - |
Estimated total contributions | 3.0 | - |
Group | Society | |||
£m | 2025 | 2024 | 2025 | 2024 |
Remeasurements of retirement benefit obligations: | ||||
| Actuarial (losses) / gains arising from: | ||||
| Experience adjustments | (0.3) | (0.3) | (0.2) | - |
| Demographic assumptions | (1.7) | 0.5 | (0.8) | 0.2 |
| Financial assumptions | 2.6 | 17.6 | 1.4 | 8.1 |
| Return on plan assets (excluding amounts included in net | (19.0) | (21.5) | (17.9) | (11.0) |
| interest expense) | ||||
Total amount recognised in Other Comprehensive Income | (18.4) | (3.7) | (17.5) | (2.7) |
Performance & Strategy Governance
Financial Statements
Other Information
Skipton Group Annual Report & Accounts 2025 228
| Group & Society | ||
£m | 2025 | 2024 |
Fixed rate reset notes: | ||
| Senior non-preferred (SNP) notes due 2026 | - | 351.7 |
| Senior non-preferred (SNP) notes due 2029 | 354.1 | 354.1 |
354.1 | 705.8 | |
Unamortised discount on issue: | ||
| Senior non-preferred (SNP) notes due 2026 | - | (0.2) |
| Senior non-preferred (SNP) notes due 2029 | (1.2) | (1.4) |
(1.2) | (1.6) | |
Fair value adjustment for hedged risk | 3.1 | (14.0) |
356.0 | 690.2 |
| Group & Society | |||
£m | 2025 | 2024 | |
8.500% Sterling Permanent Interest -Bearing Shares | 15.2 | 15.2 | |
12.875% Sterling Permanent Interest -Bearing Shares | - | 26.4 | |
15.2 | 41.6 |
Performance & Strategy Governance
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Other Information
Skipton Group Annual Report & Accounts 2025 229
Group | Society | |||
£m | 2025 | 2024 | 2025 | 2024 |
Fair value gains on hedging instruments and hedged items | (0.9) | (2.0) | (7.0) | (6.9) |
Fair value gains on derivatives associated with the equity release | (8.1) | (21.9) | (8.1) | (21.9) |
portfolio | ||||
Fair value losses on equity release portfolio (Note 18) | 14.5 | 12.6 | 14.5 | 12.6 |
Fair value gains on share warrants | (5.6) | (5.9) | - | - |
Fair value losses on put options held by minority shareholders | 0.2 | 0.3 | - | - |
Fair value gains on equity share investments at FVTPL (Note 20e)) | (0.4) | (1.1) | - | - |
Fair value (gains) / losses on debt securities at FVTPL | - | - | (3.3) | 4.0 |
Fair value losses on loan to defined benefit pension scheme | 2.2 | - | 2.2 | - |
1.9 | (18.0) | (1.7) | (12.2) |
Group | Society | |||
£m | 2025 | 2024 | 2025 | 2024 |
Impairment charge / (credit) on loans and advances to customers | 10.1 | (17.1) | 6.0 | (17.0) |
(net of recoveries) (Note 17) | ||||
Loans and advances recovered | 0.4 | 0.5 | (3.8) | 0.4 |
Impairment credit on liquid assets | (0.1) | (0.1) | (0.1) | (0.1) |
Impairment charge on trade receivables (Note 45c)) | 1.3 | 0.8 | - | - |
11.7 | (15.9) | 2.1 | (16.7) |
Group | Society | |||
£m | 2025 | 2024 | 2025 | 2024 |
(Profit) / loss on disposal of treasury assets | (0.3) | 1.8 | (0.3) | 1.8 |
Realised losses on equity release portfolio (Note 18) | 1.3 | 1.8 | 1.3 | 1.8 |
Income Statement credit for fair value of subsidiary management | - | (4.2) | - | -- |
incentive scheme liability (Note 7) | ||||
Share of profits from joint ventures | (2.0) | (1.4) | - | - |
Profit on disposal of subsidiary undertakings | (10.8) | - | - | - |
Other | 3.9 | (3.0) | (17.3) | (6.3) |
(7.9) | (5.0) | (16.3) | (2.7) |
Performance & Strategy Governance
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Other Information
Skipton Group Annual Report & Accounts 2025 230
Group | Society | |||
£m | 2025 | 2024 | 2025 | 2024 |
Purchase of property, plant and equipment and investment property | (14.0) | (22.0) | (6.3) | (10.5) |
(Notes 22, 24) | ||||
Purchase of intangible assets | (33.8) | (14.9) | (4.1) | (4.1) |
Proceeds from disposal of property, plant and equipment, investment property and intangible assets | 2.0 | 1.9 | 0.1 | - |
Dividends received from joint ventures | - | 0.5 | - | - |
Investment in equity share investments (Note 20e)) | (1.0) | (5.6) | - | - |
Purchase of other business units | (1.7) | (1.2) | - | - |
Proceeds on disposal of subsidiary undertakings in the year, net of cash disposed | 9.3 | - | - | - |
Proceeds from disposal of equity share investments | - | 0.3 | - | - |
Loan advanced to defined benefit pension scheme | (14.6) | - | (14.6) | - |
Repayment of loan to defined benefit pension scheme | 1.7 | - | 1.7 | - |
(52.1) | (41.0) | (23.2) | (14.6) |
| 2025 | |||||
Group | Put option | Lease liabilities | Subordinated | Subscribed | Total |
£m | obligation | liabilities | capital | ||
At 1 January 2025 | 4.1 | 92.1 | 690.2 | 41.6 | 828.0 |
Cash flow items: | |||||
| Lease payments (excluding | - | (39.3) | - | - | (39.3) |
| interest) | |||||
| Interest paid | - | (4.6) | (29.1) | (5.7) | (39.4) |
Exercise of put options by non- controlling shareholders | (4.2) | - | - | - | (4.2) |
| Redemption of subordinated | - | - | (350.0) | - | (350.0) |
| liabilities | |||||
Buy-back of Permanent Interest- Bearing Shares (PIBS) | - | - | - | (52.9) | (52.9) |
Non -cash flow items: | |||||
| Put option additions | 0.1 | - | - | - | 0.1 |
| Changes in fair values | 1.0 | - | 17.1 | - | 18.1 |
| Interest expense | - | 4.6 | 27.8 | 4.3 | 36.7 |
| Lease additions | - | 44.7 | - | - | 44.7 |
| Lease disposals | - | (1.9) | - | - | (1.9) |
| Lease modifications / | - | 14.7 | - | - | 14.7 |
| remeasurements | |||||
| Charge on buy-back of PIBS | - | - | - | 27.9 | 27.9 |
At 31 December 2025 | 1.0 | 110.3 | 356.0 | 15.2 | 482.5 |
Performance & Strategy Governance
Financial Statements
Other Information
Skipton Group Annual Report & Accounts 2025 231
| 2024 | ||||||
| Liability of | ||||||
Group | Put option | subsidiary | Lease | Subordinated | Subscribed | |
£m | obligation | management | liabilities | liabilities | capital | Total |
| incentive | ||||||
| scheme | ||||||
At 1 January 2024 | 3.5 | 4.2 | 103.0 | 685.3 | 41.6 | 837.6 |
Cash flow items: | ||||||
| Lease payments (excluding | - | - | (39.3) | - | - | (39.3) |
| interest) | ||||||
| Interest paid | - | - | (3.1) | (29.0) | (4.5) | (36.6) |
Non -cash flow items: | ||||||
| Changes in fair values | 0.6 | 0.3 | - | 4.3 | - | 5.2 |
| Interest expense | - | - | 3.1 | 29.6 | 4.5 | 37.2 |
| Lease additions | - | - | 18.1 | - | - | 18.1 |
| Lease disposals | - | - | (0.9) | - | - | (0.9) |
| Lease modifications / | - | - | 11.2 | - | - | 11.2 |
| remeasurements | ||||||
| Release of liability | - | (4.5) | - | - | - | (4.5) |
At 31 December 2024 | 4.1 | - | 92.1 | 690.2 | 41.6 | 828.0 |
| 2025 | ||||
Society | Lease | Subordinated | Subscribed | Total |
£m | liabilities | liabilities | capital | |
At 1 January 2025 | 8.6 | 690.2 | 41.6 | 740.4 |
Cash flow items: | ||||
| Lease payments (excluding interest) | (2.1) | - | - | (2.1) |
| Interest paid | (0.3) | (29.1) | (5.7) | (35.1) |
| Redemption of subordinated liabilities | - | (350.0) | - | (350.0) |
| Buy-back of Permanent Interest-Bearing Shares (PIBS) | - | - | (52.9) | (52.9) |
Non -cash flow items: | ||||
| Changes in fair values | - | 17.1 | - | 17.1 |
| Interest expense | 0.3 | 27.8 | 4.3 | 32.4 |
| Lease additions | 1.7 | - | - | 1.7 |
| Charge on buy-back of PIBS | - | - | 27.9 | 27.9 |
At 31 December 2025 | 8.2 | 356.0 | 15.2 | 379.4 |
Performance & Strategy Governance
Financial Statements
Other Information
Skipton Group Annual Report & Accounts 2025 232
| 2024 | ||||
Society | Lease | Subordinated | Subscribed | Total |
£m | liabilities | liabilities | capital | |
At 1 January 2024 | 10.3 | 685.3 | 41.6 | 737.2 |
Cash flow items: | ||||
| Lease payments (excluding interest) | (2.4) | - | - | (2.4) |
| Interest paid | (0.3) | (29.0) | (4.5) | (33.8) |
Non -cash flow items: | ||||
| Changes in fair values | - | 4.3 | - | 4.3 |
| Interest expense | 0.3 | 29.6 | 4.5 | 34.4 |
| Lease additions | 0.7 | - | - | 0.7 |
| Lease disposals | (0.1) | - | - | (0.1) |
| Other | 0.1 | - | - | 0.1 |
At 31 December 2024 | 8.6 | 690.2 | 41.6 | 740.4 |
2025 | 2024 | |||||
Group | Before-tax | Tax (expense) | Net-of-tax | Before-tax | Tax benefit / | Net-of-tax |
£m | amount | / benefit | amount | amount | (expense) | amount |
Financial assets held at FVOCI | 6.0 | (1.7) | 4.3 | (1.7) | 0.6 | (1.1) |
Cash flow hedges | (9.4) | 2.6 | (6.8) | 16.3 | (4.6) | 11.7 |
Cost of hedging reserve | 1.4 | (0.4) | 1.0 | (1.2) | 0.3 | (0.9) |
Remeasurements of defined | (18.4) | 5.1 | (13.3) | (3.7) | 1.0 | (2.7) |
benefit obligations | ||||||
Translation of foreign operations | (0.4) | - | (0.4) | (1.4) | - | (1.4) |
Other comprehensive income | (20.8) | 5.6 | (15.2) | 8.3 | (2.7) | 5.6 |
2025 | 2024 | |||||
Society | Before-tax | Tax (expense) | Net-of-tax | Before-tax | Tax benefit / | Net-of-tax |
£m | amount | / benefit | amount | amount | (expense) | amount |
Financial assets held at FVOCI | 6.0 | (1.7) | 4.3 | (1.8) | 0.5 | (1.3) |
Cash flow hedges | 11.5 | (3.2) | 8.3 | 10.7 | (3.0) | 7.7 |
Cost of hedging reserve | 0.1 | - | 0.1 | - | - | - |
Remeasurements of defined | (17.5) | 4.9 | (12.6) | (2.7) | 0.8 | (1.9) |
benefit obligations | ||||||
Other comprehensive income | 0.1 | - | 0.1 | 6.2 | (1.7) | 4.5 |
Performance & Strategy Governance
Financial Statements
Other Information
Skipton Group Annual Report & Accounts 2025 233
Performance & Strategy Governance
Financial Statements
Other Information
Skipton Group Annual Report & Accounts 2025 234
Performance & Strategy Governance
Financial Statements
Other Information
Skipton Group Annual Report & Accounts 2025 235
2025 | 2024 | |||||||
Group | Up to 3 | 3 - 12 | 1 – 5 | Over | Up to 3 | 3 - 12 | 1 – 5 | Over |
| months | months | years | 5 years | Months | months | years | 5 years | |
Cash flow hedges | ||||||||
Interest rate swaps | ||||||||
| Notional (£m) | - | - | 2,152.0 | 760.0 | - | - | 2,291.5 | 571.5 |
Weighted average fixed | - | - | 3.6% | 3.7% | - | - | 3.8% | 3.8% |
| interest rate (%) | ||||||||
Fair value hedges | ||||||||
Interest rate swaps | ||||||||
| Notional (£m) | 3,376.3 | 11,414.5 | 20,293.2 | 1,087.3 | 3,988.3 | 13,699.0 | 16,872.2 | 1,538.5 |
Weighted average fixed | 3.9% | 3.3% | 3.6% | 3.1% | 4.3% | 3.7% | 3.2% | 3.2% |
| interest rate (%) | ||||||||
Cross currency swaps | ||||||||
| Notional (£m) | - | - | 431.9 | - | - | - | 421.3 | - |
Weighted average fixed | - | - | 3.3% | - | - | - | 3.3% | - |
| interest rate (%) |
2025 | 2024 | |||||||
Society | Up to 3 | 3 - 12 | 1 – 5 | Over | Up to 3 | 3 - 12 | 1 – 5 | Over |
| months | months | years | 5 years | months | months | years | 5 years | |
Cash flow hedges | ||||||||
Interest rate swaps | ||||||||
| Notional (£m) | 40.2 | 325.0 | 2,936.3 | 776.7 | 23.0 | 145.0 | 3,214.3 | 571.5 |
Weighted average fixed | 1.9% | 2.6% | 3.6% | 3.7% | 3.6% | 2.6% | 3.6% | 3.8% |
| interest rate (%) | ||||||||
Fair value hedges | ||||||||
Interest rate swaps | ||||||||
| Notional (£m) | 3,416.8 | 11,530.8 | 20,695.2 | 1,087.3 | 4,110.7 | 13,813.2 | 17,205.5 | 1,538.5 |
Weighted average fixed | 3.9% | 3.3% | 3.6% | 3.1% | 4.2% | 3.6% | 3.1% | 3.2% |
| interest rate (%) | ||||||||
Cross currency swaps | ||||||||
| Notional (£m) | - | - | 10.7 | - | - | - | - | - |
Weighted average fixed | - | - | 5.9% | - | - | - | - | - |
| interest rate (%) |
Performance & Strategy Governance
Financial Statements
Other Information
Skipton Group Annual Report & Accounts 2025 236
| Carrying amount (note A) | Change in fair value | Losses reclassified from | ||||
£m | Notional | Assets | Liabilities | (charge) / credit | OCI to Income Statement | |
| (note B) | ||||||
2025 | Group | |||||
Interest rate swaps | 2,912.0 | 4.0 | (22.1) | (13.5) | (6.0) | |
2025 | Society | |||||
Interest rate swaps | 4,078.2 | 10.6 | (30.2) | 15.7 | (6.0) | |
2024 | Group | |||||
Interest rate swaps | 2,863.0 | 17.5 | (22.1) | 52.8 | 45.9 | |
2024 | Society | |||||
Interest rate swaps | 3,953.8 | 20.1 | (55.4) | 47.0 | 45.9 | |
Performance & Strategy Governance
Financial Statements
Other Information
| Carrying amount (note A) | Change in fair value | Hedge ineffectiveness | ||||
| (charge) / credit | (credit) / charge | |||||
£m | Notional | Assets | Liabilities | (note B) | (note C) | |
2025 | Group | |||||
Interest rate swaps | 36,171.3 | 296.4 | (150.6) | (380.3) | (2.1) | |
Cross currency | D | |||||
431.9 | 29.0 | - | 19.3 | 0.1 | ||
swaps | ||||||
2025 | Society | |||||
Interest rate swaps | 36,730.1 | 298.7 | (161.4) | (366.2) | (2.1) | |
Cross currency | D | |||||
10.7 | 0.2 | - | 0.2 | - | ||
swaps | ||||||
2024 | Group | |||||
Interest rate swaps | 36,068.0 | 697.4 | (171.3) | (124.0) | 5.7 | |
Cross currency | D | |||||
421.3 | 8.3 | - | 33.1 | (0.8) | ||
swaps | ||||||
2024 | Society | |||||
Interest rate swaps | 36,667.9 | 699.0 | (195.5) | (105.1) | 6.3 | |
Skipton Group Annual Report & Accounts 2025 237
| Carrying amount | Amount | ||||||
| Fair value | Change in fair | remaining on | |||||
adjustment on | value credit / | items de- | |||||
Group | Assets | Liabilities | hedged item | SoFP line | (charge) | designated | |
£m | (note A) | (note B) | from hedge | ||||
relationship | |||||||
| (note C) | |||||||
Cash flow hedges | |||||||
| Floating rate assets | 1,667.3 | - | n/a | note D | n/a | 37.6 | |
| Floating rate liabilities | - | 1,195.7 | n/a | note E | n/a | (10.0) | |
Fair value hedges | |||||||
| Fixed rate mortgages | 21,210.0 | - | (274.6) | note F | 76.3 | - | |
| Debt securities | 2,206.9 | - | (79.2) | note D | (26.9) | - | |
| Fixed rate savings | - | 12,445.7 | (1.8) | note G | 1.5 | - | |
| Covered bonds | - | 418.6 | 3.7 | note E | 26.5 | - | |
| Subordinated liabilities | - | 705.8 | (14.0) | note H | 4.2 | - |
Performance & Strategy Governance
Financial Statements
Other Information
| Carrying amount | Amount | |||||
| Fair value | remaining on | |||||
adjustment on | Change in fair | items de- | ||||
Group | Assets | Liabilities | hedged item | SoFP line | value credit | designated |
£m | (note A) | (note B) | from hedge | |||
relationship | ||||||
| (note C) | ||||||
Cash flow hedges | ||||||
| Floating rate assets | 670.5 | - | n/a | note D | n/a | 32.5 |
| Floating rate liabilities | - | 2,241.5 | n/a | note E | n/a | (2.0) |
Fair value hedges | ||||||
| Fixed rate mortgages | 21,024.8 | - | 58.9 | note F | 333.5 | - |
| Debt securities | 2,049.9 | - | (36.0) | note D | 43.2 | - |
| Fixed rate savings | - | 11,617.6 | 56.5 | note G | 58.3 | - |
| Covered bonds | - | 442.7 | 22.3 | note E | 18.6 | - |
| Due from Group companies | - | - | (0.1) | note I | (0.1) | - |
| Subordinated liabilities | - | 354.1 | 3.1 | note H | 17.1 | - |
Skipton Group Annual Report & Accounts 2025 238
| Carrying amount | Amount | ||||||
| Fair value | Change in fair | remaining on | |||||
adjustment on | value credit / | items de- | |||||
Society | Assets | Liabilities | hedged item | SoFP line | (charge) | designated | |
£m | (note A) | (note B) | from hedge | ||||
relationship | |||||||
| (note C) | |||||||
Cash flow hedges | |||||||
| Floating rate assets | 1,775.3 | - | n/a | note D | n/a | 37.6 | |
| Floating rate liabilities | - | 2,178.5 | n/a | note E | n/a | (10.1) | |
Fair value hedges | |||||||
| Fixed rate mortgages | 21,325.2 | - | (271.7) | note F | 75.7 | - | |
| Debt securities | 2,206.9 | - | (79.3) | note D | (26.9) | - | |
| Fixed rate savings | - | 12,930.5 | (16.2) | note G | 14.6 | - | |
| Subordinated liabilities | - | 705.8 | (14.0) | note H | 4.2 | - |
Performance & Strategy Governance
Financial Statements
Other Information
| Carrying amount | Amount | |||||
| Fair value | Change in fair | remaining on | ||||
adjustment on | value credit / | items de- | ||||
Society | Assets | Liabilities | hedged item | SoFP line | (charge) | designated |
£m | (note A) | (note B) | from hedge | |||
relationship | ||||||
| (note C) | ||||||
Cash flow hedges | ||||||
| Floating rate assets | 1,597.8 | n/a | note D | n/a | 32.5 | |
| Floating rate liabilities | 2,480.4 | n/a | note E | n/a | (4.2) | |
Fair value hedges | ||||||
| Fixed rate mortgages | 21,024.8 | - | 60.9 | note F | 332.6 | - |
| Debt securities | 2,049.9 | - | (36.1) | note D | 43.2 | - |
| Fixed rate savings | - | 12,176.4 | 54.5 | note G | 70.7 | - |
| Due from Group companies | 10.7 | - | (0.1) | note I | (0.1) | - |
| Subordinated liabilities | - | 354.1 | 3.1 | note H | 17.1 | - |
Skipton Group Annual Report & Accounts 2025 239
2025 | 2024 | |||||
Group | Cash flow | Cost of | Cash flow | Cost of | ||
£m | hedging | hedging | Total | hedging | hedging | Total |
| reserve | reserve | reserve | reserve | |||
Balance at 1 January | 16.6 | (1.4) | 15.2 | 4.9 | (0.5) | 4.4 |
Change in fair value of derivatives in effective hedging relationships: | ||||||
| Held to hedge interest rate | (6.3) | 1.4 | (4.9) | 6.3 | (1.2) | 5.1 |
| risk | ||||||
Net amounts reclassified to profit or loss from derivatives: | ||||||
| Held to hedge interest rate | (3.1) | - | (3.1) | 10.0 | - | 10.0 |
| risk | ||||||
Tax on movements in reserves | 2.6 | (0.4) | 2.2 | (4.6) | 0.3 | (4.3) |
during the year | ||||||
Balance at 31 December | 9.8 | (0.4) | 9.4 | 16.6 | (1.4) | 15.2 |
2025 | 2024 | |||||||
| Cash flow | Cost of | Cash flow | Cost of | |||||
Society | ||||||||
| hedging | hedging | Total | hedging | hedging | Total | |||
£m | ||||||||
| reserve | reserve | reserve | reserve | |||||
Balance at 1 January | 1.3 | - | 1.3 | (6.4) | - | (6.4) | ||
Change in fair value of derivatives in effective hedging relationships: | ||||||||
| Held to hedge interest rate | 16.7 | 0.1 | 16.8 | 0.9 | - | 0.9 | ||
| risk | ||||||||
Net amounts reclassified to profit or loss from derivatives: | ||||||||
| Held to hedge interest rate | (5.2) | - | (5.2) | 9.8 | - | 9.8 | ||
| risk | ||||||||
Tax on movements in reserves | (3.2) | - | (3.2) | (3.0) | - | (3.0) | ||
during the year | ||||||||
Balance at 31 December | 9.6 | 0.1 | 9.7 | 1.3 | - | 1.3 |
Performance & Strategy Governance
Financial Statements
Other Information
| Carrying amount | Change in fair value | |||||
| recognised in OCI: | Amount reclassified from | |||||
£m | Notional | Assets | Liabilities | credit / (charge) | OCI to Income Statement | |
| (note A) | ||||||
2025 | Group | |||||
Cross currency | 431.9 | 29.0 | - | 1.4 | - | |
swaps | ||||||
2025 | Society | |||||
Cross currency | 10.7 | 0.2 | - | 0.1 | - | |
swaps | ||||||
2024 | Group | |||||
Cross currency | 421.3 | 8.4 | - | (1.2) | - | |
swaps | ||||||
Skipton Group Annual Report & Accounts 2025 240
Performance & Strategy Governance
Financial Statements
Other Information
Skipton Group Annual Report & Accounts 2025 241
| 2025 | |||||||
Group | Repayable | Up to 3 | 3 - 12 | 1 - 5 | Over 5 | No | |
£m | on demand | months | months | years | years | specified | Total |
| maturity | |||||||
Assets | |||||||
Cash in hand and balances with the Bank of England | 1,360.2 | - | - | - | - | - | 1,360.2 |
Loans and advances to credit | 88.8 | - | - | - | - | 264.5 | 353.3 |
institutions | |||||||
Debt securities | - | 809.4 | 253.6 | 2,536.5 | 669.9 | - | 4,269.4 |
Derivative financial | - | 17.3 | 75.6 | 179.9 | 78.0 | - | 350.8 |
instruments | |||||||
Loans and advances to customers | 196.6 | 27.1 | 77.4 | 994.5 | 32,083.3 | - | 33,378.9 |
held at amortised cost | |||||||
Loans and advances to customers held at FVTPL | 0.8 | - | - | - | - | - | 0.8 |
Equity release portfolio at FVTPL | - | 6.3 | 18.6 | 76.4 | 161.8 | - | 263.1 |
Equity share investments at FVTPL | - | - | - | - | - | 18.3 | 18.3 |
Trade receivables | 31.0 | 42.6 | - | - | - | - | 73.6 |
Total financial assets | 1,677.4 | 902.7 | 425.2 | 3,787.3 | 32,993.0 | 282.8 | 40,068.4 |
Liabilities | |||||||
Shares | 13,614.8 | 2,843.4 | 8,787.9 | 5,193.4 | 86.8 | - | 30,526.3 |
Amounts owed to credit institutions | 9.7 | 167.9 | 6.4 | - | - | 143.2 | 327.2 |
Amounts owed to other customers | 820.3 | 559.9 | 1,229.5 | 109.9 | - | - | 2,719.6 |
Debt securities in issue | - | 0.5 | - | 3,361.4 | - | - | 3,361.9 |
Derivative financial instruments | - | 5.6 | 27.5 | 138.6 | 14.5 | - | 186.2 |
Lease liabilities | - | 7.9 | 21.9 | 64.8 | 15.7 | - | 110.3 |
Trade payables | - | 14.4 | - | - | - | - | 14.4 |
Fair value of put option obligation | - | - | 0.7 | 0.3 | - | - | 1.0 |
Subordinated liabilities | - | - | - | 356.0 | - | - | 356.0 |
Subscribed capital | - | - | - | - | - | 15.2 | 15.2 |
Total financial liabilities | 14,444.8 | 3,599.6 | 10,073.9 | 9,224.4 | 117.0 | 158.4 | 37,618.1 |
Net liquidity gap | (12,767.4) | (2,696.9) | (9,648.7) | (5,437.1) | 32,876.0 | 124.4 | 2,450.3 |
Performance & Strategy Governance
Financial Statements
Other Information
Skipton Group Annual Report & Accounts 2025 242
| 2024 (restated*) | |||||||
Group | Repayable | Up to 3 | 3 - 12 | 1 - 5 | Over 5 | No | |
£m | on demand | months | months | years | years | specified | Total |
| maturity | |||||||
Assets | |||||||
Cash in hand and balances with the Bank of England | 1,930.6 | - | - | - | - | - | 1,930.6 |
Loans and advances to credit | 121.5 | 1.6 | 1.0 | - | - | 290.5 | 414.6 |
institutions | |||||||
Debt securities | - | 492.9 | 826.3 | 2,222.1 | 808.3 | - | 4,349.6 |
Derivative financial | - | 25.2 | 99.2 | 513.0 | 114.7 | - | 752.1 |
instruments | |||||||
Loans and advances to customers | 188.4 | 28.9 | 55.5 | 942.8 | 29,385.5 | - | 30,601.1 |
held at amortised cost | |||||||
Loans and advances to customers held at FVTPL | 0.9 | - | - | - | - | - | 0.9 |
Equity release portfolio at FVTPL | - | 6.6 | 19.2 | 70.1 | 181.3 | - | 277.2 |
Equity share investments at FVTPL | - | - | - | - | - | 16.9 | 16.9 |
Trade receivables | 30.5 | 38.3 | - | - | - | - | 68.9 |
Share warrants | 21.9 | - | - | - | - | - | 21.9 |
Other assets | - | - | - | - | - | 0.1 | 0.1 |
Total financial assets | 2,293.8 | 593.5 | 1,001.2 | 3,748.0 | 30,489.8 | 307.5 | 38,433.8 |
Liabilities | |||||||
Shares | 11,415.2 | 3,715.1 | 9,162.4 | 3,889.0 | 86.8 | - | 28,268.5 |
Amounts owed to credit institutions | 19.0 | 6.1 | 1,017.2 | - | - | 557.3 | 1,599.6 |
Amounts owed to other customers | 895.9 | 715.4 | 1,018.2 | 121.6 | - | - | 2,751.1 |
Debt securities in issue | - | 5.9 | - | 2,429.4 | - | - | 2,435.3 |
Derivative financial instruments | - | 14.3 | 60.7 | 115.3 | 34.8 | - | 225.1 |
Lease liabilities | - | 7.1 | 19.5 | 52.2 | 13.3 | - | 92.1 |
Trade payables | - | 11.0 | - | - | - | - | 11.0 |
Fair value of put option obligation | - | - | 3.8 | 0.3 | - | - | 4.1 |
Subordinated liabilities | - | - | - | 340.0 | 350.2 | - | 690.2 |
Subscribed capital | - | - | - | - | - | 41.6 | 41.6 |
Total financial liabilities | 12,330.1 | 4,474.9 | 11,281.8 | 6,947.8 | 485.1 | 598.9 | 36,118.6 |
Net liquidity gap | (10,036.3) | (3,881.4) | (10,280.6) | (3,199.8) | 30,004.7 | (291.4) | 2,315.2 |
Performance & Strategy Governance
Financial Statements
Other Information
Skipton Group Annual Report & Accounts 2025 243
| 2025 | |||||||
Society | Repayable | Up to 3 | 3 - 12 | 1 - 5 | Over 5 | No | |
£m | on demand | months | months | years | years | specified | Total |
| maturity | |||||||
Assets | |||||||
Cash in hand and balances with the Bank of England | 1,360.2 | - | - | - | - | - | 1,360.2 |
Loans and advances to credit | 31.2 | - | - | - | - | 273.5 | 304.7 |
Institutions | |||||||
Debt securities | - | 593.1 | 253.6 | 2,758.8 | 669.9 | - | 4,275.4 |
Derivative financial | - | 17.4 | 75.9 | 159.3 | 80.5 | - | 333.1 |
Instruments | |||||||
Loans and advances to customers | 3.0 | 26.8 | 75.5 | 988.0 | 30,028.0 | - | 31,121.3 |
held at amortised cost | |||||||
Loans and advances to customers held at FVTPL | 0.8 | - | - | - | - | - | 0.8 |
Equity release portfolio at FVTPL | - | 6.3 | 18.6 | 76.4 | 161.8 | - | 263.1 |
Loans to subsidiary undertakings | 454.7 | - | - | - | - | - | 454.7 |
Trade receivables | 1.5 | - | - | - | - | - | 1.5 |
Total financial assets | 1,851.4 | 643.6 | 423.6 | 3,982.5 | 30,940.2 | 273.5 | 38,114.8 |
Liabilities | |||||||
Shares | 13,614.8 | 2,843.4 | 8,787.9 | 5,193.4 | 84.8 | - | 30,524.3 |
Amounts owed to credit institutions | 9.7 | 353.8 | 6.4 | - | - | 143.2 | 513.1 |
Amounts owed to other customers | 508.3 | 32.4 | 14.3 | 616.9 | - | - | 1,171.9 |
Debt securities in issue | - | - | - | 2,955.0 | - | - | 2,955.0 |
Derivative financial instruments | - | 8.2 | 34.1 | 148.2 | 14.5 | - | 205.0 |
Lease liabilities | - | 0.5 | 1.4 | 5.2 | 1.1 | - | 8.2 |
Trade payables | - | 3.4 | - | - | - | - | 3.4 |
Subordinated liabilities | - | - | - | 356.0 | - | - | 356.0 |
Subscribed capital | - | - | - | - | - | 15.2 | 15.2 |
Total financial liabilities | 14,132.8 | 3,241.7 | 8,844.1 | 9,274.7 | 100.4 | 158.4 | 35,752.1 |
Net liquidity gap | (12,281.4) | (2,598.1) | (8,420.5) | (5,292.2) | 30,839.8 | 115.1 | 2,362.7 |
Performance & Strategy Governance
Financial Statements
Other Information
Skipton Group Annual Report & Accounts 2025 244
| 2024 (restated*) | |||||||
Society | Repayable | Up to 3 | 3 - 12 | 1 - 5 | Over 5 | No | |
£m | on demand | months | months | years | years | specified | Total |
| maturity | |||||||
Assets | |||||||
Cash in hand and balances with the Bank of England | 1,930.6 | - | - | - | - | - | 1,930.6 |
Loans and advances to credit | 54.0 | - | 1.0 | - | - | 342.8 | 397.8 |
Institutions | |||||||
Debt securities | - | 273.9 | 768.5 | 2,489.4 | 808.3 | - | 4,340.1 |
Derivative financial | - | 25.5 | 99.5 | 507.7 | 110.3 | - | 743.0 |
Instruments | |||||||
Loans and advances to customers | 3.2 | 28.9 | 53.8 | 905.6 | 27,343.4 | - | 28,334.9 |
held at amortised cost | |||||||
Loans and advances to customers held at FVTPL | 0.9 | - | - | - | - | - | 0.9 |
Equity release portfolio at FVTPL | - | 6.6 | 19.2 | 70.1 | 181.3 | - | 277.2 |
Loans to subsidiary undertakings | 403.9 | - | - | - | - | - | 403.9 |
Trade receivables | 1.9 | - | - | - | - | - | 1.9 |
Total financial assets | 2,394.5 | 334.9 | 942.0 | 3,972.8 | 28,443.3 | 342.8 | 36,430.3 |
Liabilities | |||||||
Shares | 11,415.2 | 3,715.1 | 9,162.4 | 3,889.0 | 72.4 | - | 28,254.1 |
Amounts owed to credit institutions | 19.0 | 207.1 | 1,017.2 | - | - | 557.3 | 1,800.6 |
Amounts owed to other customers | 470.4 | 49.9 | - | 748.6 | - | - | 1,268.9 |
Debt securities in issue | - | 5.1 | - | 1,925.0 | - | - | 1,930.1 |
Derivative financial instruments | - | 17.7 | 67.1 | 162.6 | 34.8 | - | 282.2 |
Lease liabilities | - | 0.5 | 1.5 | 5.2 | 1.4 | - | 8.6 |
Trade payables | - | 2.8 | - | - | - | - | 2.8 |
Subordinated liabilities | - | - | - | 340.0 | 350.2 | - | 690.2 |
Subscribed capital | - | - | - | - | - | 41.6 | 41.6 |
Total financial liabilities | 11,904.6 | 3,998.2 | 10,248.2 | 7,070.4 | 458.8 | 598.9 | 34,279.1 |
Net liquidity gap | (9,510.1) | (3,663.3) | (9,306.2) | (3,097.6) | 27,984.5 | (256.1) | 2,151.2 |
Performance & Strategy Governance
Financial Statements
Other Information
Skipton Group Annual Report & Accounts 2025 245
| 2025 | |||||
Group | Up to 3 | 3 - 12 | 1 - 5 | Over 5 | Total |
£m | months | months | years | years | |
Shares | 16,471.6 | 9,003.6 | 5,592.3 | 87.9 | 31,155.4 |
Amounts owed to credit institutions, other customers and debt securities in issue | 1,382.3 | 1,752.0 | 3,634.3 | - | 6,768.6 |
Derivative financial instruments | 8.9 | 51.9 | 132.0 | 0.1 | 192.9 |
Lease liabilities | 8.4 | 27.8 | 73.4 | 23.2 | 132.8 |
Trade payables | 14.4 | - | - | - | 14.4 |
Fair value of put option obligation | - | 0.7 | 0.4 | - | 1.1 |
Subordinated liabilities | - | 21.9 | 393.8 | - | 415.7 |
Subscribed capital | - | 1.3 | 5.1 | note A | 6.4 |
Total | 17,885.6 | 10,859.2 | 9,831.3 | 111.2 | 38,687.3 |
| 2024 | |||||
Group | Up to 3 | 3 - 12 | 1 - 5 | Over 5 | Total |
£m | months | months | years | years | |
Shares | 15,148.0 | 9,408.1 | 4,148.1 | 86.8 | 28,791.0 |
Amounts owed to credit institutions, other customers and debt securities in issue | 1,552.1 | 3,057.5 | 2,569.6 | - | 7,179.2 |
Derivative financial instruments | 20.9 | 98.8 | 104.1 | 11.9 | 235.7 |
Lease liabilities | 7.5 | 25.2 | 58.7 | 20.8 | 112.2 |
Trade payables | 11.0 | - | - | - | 11.0 |
Fair value of put option obligation | - | 3.9 | 0.4 | - | 4.3 |
Subordinated liabilities | - | 28.9 | 769.1 | - | 798.0 |
Subscribed capital | 1.6 | 2.9 | 18.0 | note A | 22.5 |
Total | 16,741.1 | 12,625.3 | 7,668.0 | 119.5 | 37,153.9 |
Performance & Strategy Governance
Financial Statements
Other Information
Skipton Group Annual Report & Accounts 2025 246
| 2025 | |||||
| Up to 3 | 3 - 12 | 1 - 5 | Over 5 | Total | |
| months | months | years | years | ||
Shares | 16,471.6 | 9,003.6 | 5,592.3 | 85.9 | 31,153.4 |
Amounts owed to credit institutions, other customers and debt securities in issue | 758.9 | 566.7 | 3,796.7 | - | 5,122.3 |
Derivative financial instruments | 8.9 | 60.5 | 134.7 | 0.1 | 204.2 |
Lease liabilities | 0.6 | 1.5 | 5.8 | 1.2 | 9.1 |
Trade payables | 3.4 | - | - | - | 3.4 |
Subordinated liabilities | - | 21.9 | 393.8 | - | 415.7 |
Subscribed capital | - | 1.3 | 5.1 | note A | 6.4 |
Total | 17,243.4 | 9,655.5 | 9,928.4 | 87.2 | 36,914.5 |
| 2024 | |||||
| Up to 3 | 3 - 12 | 1 - 5 | Over 5 | Total | |
| months | months | years | years | ||
Shares | 15,148.0 | 9,408.1 | 4,148.1 | 72.4 | 28,776.6 |
Amounts owed to credit institutions, other customers and debt securities in issue | 653.0 | 1,944.9 | 2,925.1 | - | 5,523.0 |
Derivative financial instruments | 35.5 | 122.7 | 130.5 | 11.9 | 300.6 |
Lease liabilities | 0.6 | 1.6 | 5.6 | 1.5 | 9.3 |
Trade payables | 2.8 | - | - | - | 2.8 |
Subordinated liabilities | - | 28.9 | 769.1 | - | 798.0 |
Subscribed capital | 1.6 | 2.9 | 18.0 | note A | 22.5 |
Total | 15,841.5 | 11,509.1 | 7,996.4 | 85.8 | 35,432.8 |
Performance & Strategy Governance
Financial Statements
Other Information
Skipton Group Annual Report & Accounts 2025 247
£m | As at 31 December | Average | High | Low | As at 31 December | |
| 2025 | 2025 | 2025 | 2025 | 2024 | ||
Static earnings -at-risk | 25.3 | 22.1 | 25.5 | 16.8 | 27.9 | |
Historical value -at-risk | 3.3 | 5.1 | 7.1 | 2.1 | 3.5 | |
2% parallel interest rate shift | 8.8 | 14.5 | 21.8 | 4.1 | 20.8 |
Performance & Strategy Governance
Financial Statements
Other Information
Skipton Group Annual Report & Accounts 2025 248
Performance & Strategy Governance
Financial Statements
Other Information
Skipton Group Annual Report & Accounts 2025 249
Performance & Strategy Governance
Financial Statements
Other Information
Skipton Group Annual Report & Accounts 2025 250
Performance & Strategy Governance
Financial Statements
Other Information
Skipton Group Annual Report & Accounts 2025 251
| 2025 | ||||||
| Fair value | ||||||
Group | Gross carrying | ECL allowance | adjustment for | Carrying amount | ||
| amount | (Note 17) | hedged risk | ||||
| £m | £m | £m | £m | % | ||
Residential mortgages | 33,007.5 | (21.6) | 58.9 | 33,044.8 | 99.0 | |
Loans fully secured on land^ | 92.2 | (2.6) | - | 89.6 | 0.3 | |
Other lending: | ||||||
| Debt factoring advances | 200.6 | (1.4) | - | 199.2 | 0.6 | |
| Other loans | 45.3 | - | - | 45.3 | 0.1 | |
Total | 33,345.6 | (25.6) | 58.9 | 33,378.9 | 100.0 |
| 2024 | ||||||
| Fair value | ||||||
Group | Gross carrying | ECL allowance | adjustment for | Carrying amount | ||
| amount | (Note 17) | hedged risk | ||||
| £m | £m | £m | £m | % | ||
Residential mortgages | 30,542.8 | (13.5) | (274.6) | 30,254.7 | 98.8 | |
Loans fully secured on land^ | 114.3 | (4.7) | - | 109.6 | 0.4 | |
Other lending: | ||||||
| Debt factoring advances | 190.0 | (1.4) | - | 188.6 | 0.6 | |
| Other loans | 48.2 | - | - | 48.2 | 0.2 | |
Total | 30,895.3 | (19.6) | (274.6) | 30,601.1 | 100.0 |
| 2025 | ||||||
| Fair value | ||||||
Society | Gross carrying | ECL allowance | adjustment for | Carrying amount | ||
| amount | (Note 17) | hedged risk | ||||
| £m | £m | £m | £m | % | ||
Residential mortgages | 30,991.2 | (20.9) | 60.9 | 31,031.2 | 99.7 | |
Loans fully secured on land^ | 92.2 | (2.6) | - | 89.6 | 0.3 | |
Other lending | 0.5 | - | - | 0.5 | - | |
Total | 31,083.9 | (23.5) | 60.9 | 31,121.3 | 100.0 |
| 2024 | ||||||
| Fair value | ||||||
Society | Gross carrying | ECL allowance | adjustment for | Carrying amount | ||
| amount | (Note 17) | hedged risk | ||||
| £m | £m | £m | £m | % | ||
Residential mortgages | 28,509.8 | (12.8) | (271.7) | 28,225.3 | 99.6 | |
Loans fully secured on land^ | 114.3 | (4.7) | - | 109.6 | 0.4 | |
Total | 28,624.1 | (17.5) | (271.7) | 28,334.9 | 100.0 |
Performance & Strategy Governance
Financial Statements
Other Information
Skipton Group Annual Report & Accounts 2025 252
2025 | Group | Society | ||||||
£m | Stage 1 | Stage 2 | Stage 3 | Total | Stage 1 | Stage 2 | Stage 3 | Total |
Not past due | 32,216.6 | 468.4 | 19.8 | 32,704.8 | 30,212.1 | 465.1 | 19.8 | 30,697.0 |
Up to 30 days past due | - | 104.5 | 3.3 | 107.8 | - | 101.9 | 3.3 | 105.2 |
31 to 60 days past due | - | 49.9 | 7.8 | 57.7 | - | 47.1 | 7.8 | 54.9 |
61 to 90 days past due | - | 23.8 | 11.2 | 35.0 | - | 23.1 | 11.2 | 34.3 |
Over 90 days past due | - | - | 102.2 | 102.2 | - | - | 99.8 | 99.8 |
Total | 32,216.6 | 646.6 | 144.3 | 33,007.5 | 30,212.1 | 637.2 | 141.9 | 30,991.2 |
2024 | Group | Society | ||||||
£m | Stage 1 | Stage 2 | Stage 3 | Total | Stage 1 | Stage 2 | Stage 3 | Total |
Not past due | 30,067.3 | 224.2 | 13.8 | 30,305.3 | 28,046.0 | 220.4 | 13.8 | 28,280.2 |
Up to 30 days past due | - | 72.5 | 3.6 | 76.1 | - | 70.6 | 3.6 | 74.2 |
31 to 60 days past due | - | 46.4 | 4.6 | 51.0 | - | 43.6 | 4.6 | 48.2 |
61 to 90 days past due | - | 15.7 | 9.8 | 25.5 | - | 15.7 | 9.8 | 25.5 |
Over 90 days past due | - | - | 84.9 | 84.9 | - | - | 81.7 | 81.7 |
Total | 30,067.3 | 358.8 | 116.7 | 30,542.8 | 28,046.0 | 350.3 | 113.5 | 28,509.8 |
2025 | Group | Society | ||||||
£m | Stage 1 | Stage 2 | Stage 3 | Total | Stage 1 | Stage 2 | Stage 3 | Total |
Gross carrying amount at 1 January | 30,067.3 | 358.8 | 116.7 | 30,542.8 | 28,046.0 | 350.3 | 113.5 | 28,509.8 |
Transfers due to changes in credit | ||||||||
risk (note A): | ||||||||
| From stage 1 to stage 2 | (379.9) | 379.9 | - | - | (373.3) | 373.3 | - | - |
| From stage 1 to stage 3 | (17.5) | - | 17.5 | - | (16.6) | - | 16.6 | - |
| From stage 2 to stage 1 | 102.5 | (102.5) | - | - | 99.1 | (99.1) | - | - |
| From stage 2 to stage 3 | - | (16.5) | 16.5 | - | - | (16.5) | 16.5 | - |
| From stage 3 to stage 2 | - | 10.2 | (10.2) | - | - | 10.2 | (10.2) | - |
| From stage 3 to stage 1 | 0.6 | - | (0.6) | - | 0.6 | - | (0.6) | - |
Modification of contractual | (99.4) | 67.9 | 26.3 | (5.2) | (99.4) | 67.9 | 26.3 | (5.2) |
cashflows | ||||||||
Increases due to origination | 6,960.1 | 19.3 | 2.1 | 6,981.5 | 6,772.4 | 19.3 | 2.1 | 6,793.8 |
Decrease due to derecognition and repayments | (4,427.6) | (71.1) | (20.7) | (4,519.4) | (4,227.2) | (68.8) | (19.0) | (4,315.0) |
Written off | - | (0.1) | (4.1) | (4.2) | - | (0.1) | (4.1) | (4.2) |
Other movements | 10.5 | 0.7 | 0.8 | 12.0 | 10.5 | 0.7 | 0.8 | 12.0 |
Gross carrying amount at 31 December | 32,216.6 | 646.6 | 144.3 | 33,007.5 | 30,212.1 | 637.2 | 141.9 | 30,991.2 |
Performance & Strategy Governance
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Other Information
Skipton Group Annual Report & Accounts 2025 253
2024 | Group | Society | ||||||
£m | Stage 1 | Stage 2 | Stage 3 | Total | Stage 1 | Stage 2 | Stage 3 | Total |
Gross carrying amount at 1 January | 27,485.7 | 628.6 | 78.0 | 28,192.3 | 25,412.6 | 624.3 | 77.1 | 26,114.0 |
Transfers due to changes in credit | ||||||||
risk (note A): | ||||||||
| From stage 1 to stage 2 | (180.2) | 180.2 | - | - | (171.8) | 171.8 | - | - |
| From stage 1 to stage 3 | (14.8) | - | 14.8 | - | (11.7) | - | 11.7 | - |
| From stage 2 to stage 1 | 352.8 | (352.8) | - | - | 350.3 | (350.3) | - | - |
| From stage 2 to stage 3 | - | (15.5) | 15.5 | - | - | (15.5) | 15.5 | - |
| From stage 3 to stage 2 | - | 6.0 | (6.0) | - | - | 6.0 | (6.0) | - |
| From stage 3 to stage 1 | 1.0 | - | (1.0) | - | 1.0 | - | (1.0) | - |
Modification of contractual | (26.8) | (8.5) | 30.6 | (4.7) | (26.8) | (8.5) | 30.6 | (4.7) |
cashflows | ||||||||
Increases due to origination | 5,996.7 | 15.1 | 0.7 | 6,012.5 | 5,833.8 | 15.1 | 0.7 | 5,849.6 |
Decrease due to derecognition and repayments | (3,555.8) | (93.9) | (12.7) | (3,662.4) | (3,350.1) | (92.2) | (11.9) | (3,454.2) |
Written off | (0.1) | (0.4) | (3.9) | (4.4) | (0.1) | (0.4) | (3.9) | (4.4) |
Other movements | 8.8 | - | 0.7 | 9.5 | 8.8 | - | 0.7 | 9.5 |
Gross carrying amount at 31 December | 30,067.3 | 358.8 | 116.7 | 30,542.8 | 28,046.0 | 350.3 | 113.5 | 28,509.8 |
Performance & Strategy Governance
Financial Statements
Other Information
Skipton Group Annual Report & Accounts 2025 254
2025 | Group | Society | ||||||
£m | Stage 1 | Stage 2 | Stage 3 | Total | Stage 1 | Stage 2 | Stage 3 | Total |
Loss allowance at 1 January | 4.5 | 2.5 | 6.5 | 13.5 | 4.4 | 2.4 | 6.0 | 12.8 |
Transfers due to changes in credit | ||||||||
risk: | ||||||||
| From stage 1 to stage 2 | (0.1) | 2.3 | - | 2.2 | (0.1) | 2.3 | - | 2.2 |
| From stage 1 to stage 3 | - | - | 1.0 | 1.0 | - | - | 1.0 | 1.0 |
| From stage 2 to stage 1 | - | (0.2) | - | (0.2) | - | (0.2) | - | (0.2) |
| From stage 2 to stage 3 | - | (0.3) | 0.7 | 0.4 | - | (0.3) | 0.7 | 0.4 |
| From stage 3 to stage 2 | - | 0.1 | (0.1) | - | - | 0.1 | (0.1) | - |
Remeasurements within existing | 2.3 | 0.3 | - | 2.6 | 2.2 | 0.1 | 0.2 | 2.5 |
stage | ||||||||
Increases due to origination | 2.4 | 0.3 | - | 2.7 | 2.5 | 0.3 | - | 2.8 |
Decrease due to derecognition and repayments | (0.5) | (0.3) | (1.4) | (2.2) | (0.5) | (0.3) | (1.4) | (2.2) |
Changes due to modification | - | 0.7 | 1.5 | 2.2 | - | 0.7 | 1.5 | 2.2 |
without derecognition | ||||||||
Written off | - | - | (0.6) | (0.6) | - | - | (0.6) | (0.6) |
Loss allowance at 31 December | 8.6 | 5.4 | 7.6 | 21.6 | 8.5 | 5.1 | 7.3 | 20.9 |
2024 | Group | Society | ||||||
£m | Stage 1 | Stage 2 | Stage 3 | Total | Stage 1 | Stage 2 | Stage 3 | Total |
Loss allowance at 1 January | 16.2 | 6.0 | 6.8 | 29.0 | 15.4 | 5.9 | 6.6 | 27.9 |
Transfers due to changes in credit | ||||||||
risk: | ||||||||
| From stage 1 to stage 2 | (0.1) | 0.8 | - | 0.7 | (0.1) | 0.8 | - | 0.7 |
| From stage 1 to stage 3 | - | - | 0.5 | 0.5 | - | - | 0.5 | 0.5 |
| From stage 2 to stage 1 | 0.1 | (1.6) | - | (1.5) | 0.1 | (1.6) | - | (1.5) |
| From stage 2 to stage 3 | - | (0.4) | 0.4 | - | - | (0.4) | 0.4 | - |
| From stage 3 to stage 2 | - | 0.1 | (0.2) | (0.1) | - | 0.1 | (0.2) | (0.1) |
Remeasurements within existing | (11.0) | (0.8) | (0.4) | (12.2) | (10.4) | (0.9) | (0.7) | (12.0) |
stage | ||||||||
Increases due to origination | 1.2 | 0.1 | 0.1 | 1.4 | 1.1 | 0.1 | 0.1 | 1.3 |
Decrease due to derecognition and repayments | (1.9) | (0.6) | (0.9) | (3.4) | (1.7) | (0.5) | (0.9) | (3.1) |
Changes due to modification | - | (1.1) | 0.9 | (0.2) | - | (1.1) | 0.9 | (0.2) |
without derecognition | ||||||||
Written off | - | - | (0.7) | (0.7) | - | - | (0.7) | (0.7) |
Loss allowance at 31 December | 4.5 | 2.5 | 6.5 | 13.5 | 4.4 | 2.4 | 6.0 | 12.8 |
Performance & Strategy Governance
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Other Information
Skipton Group Annual Report & Accounts 2025 255
Group 2025 (£m) | Gross Carrying Amount | Loss Allowance | ||||||
Probability of default | Stage 1 | Stage 2 | Stage 3 | Total | Stage 1 | Stage 2 | Stage 3 | Total |
<0.15% | 1,409.6 | 0.9 | - | 1,410.5 | 0.5 | - | - | 0.5 |
0.15% - <0.25% | 4,408.0 | 1.6 | - | 4,409.6 | 0.8 | - | - | 0.8 |
0.25% - <0.5% | 16,089.9 | 1.8 | - | 16,091.7 | 3.6 | - | - | 3.6 |
0.5% - <0.75% | 7,690.8 | 4.9 | - | 7,695.7 | 2.3 | - | - | 2.3 |
0.75% - <2.5% | 2,601.4 | 51.0 | - | 2,652.4 | 1.4 | - | - | 1.4 |
2.5% - <10% | 16.9 | 144.7 | - | 161.6 | - | 0.2 | - | 0.2 |
10% - <100% | - | 441.7 | - | 441.7 | - | 5.2 | - | 5.2 |
Default | - | - | 144.3 | 144.3 | - | - | 7.6 | 7.6 |
Total | 32,216.6 | 646.6 | 144.3 | 33,007.5 | 8.6 | 5.4 | 7.6 | 21.6 |
ECL coverage by stage (%) | 0.03% | 0.84% | 5.27% | 0.07% |
Group 2024 (£m) | Gross Carrying Amount | Loss Allowance | ||||||
Probability of default | Stage 1 | Stage 2 | Stage 3 | Total | Stage 1 | Stage 2 | Stage 3 | Total |
<0.15% | 4,841.6 | 0.4 | - | 4,842.0 | 0.6 | - | - | 0.6 |
0.15% - <0.25% | 11,387.8 | 0.4 | - | 11,388.2 | 1.5 | - | - | 1.5 |
0.25% - <0.5% | 10,752.9 | 5.7 | - | 10,758.6 | 1.8 | - | - | 1.8 |
0.5% - <0.75% | 2,647.4 | 13.0 | - | 2,660.4 | 0.4 | - | - | 0.4 |
0.75% - <2.5% | 430.9 | 65.3 | - | 496.2 | 0.2 | - | - | 0.2 |
2.5% - <10% | 6.7 | 59.4 | - | 66.1 | - | 0.1 | - | 0.1 |
10% - <100% | - | 214.6 | - | 214.6 | - | 2.4 | - | 2.4 |
Default | - | - | 116.7 | 116.7 | - | - | 6.5 | 6.5 |
Total | 30,067.3 | 358.8 | 116.7 | 30,542.8 | 4.5 | 2.5 | 6.5 | 13.5 |
ECL coverage by stage (%) | 0.01% | 0.70% | 5.57% | 0.04% |
Performance & Strategy Governance
Financial Statements
Other Information
Skipton Group Annual Report & Accounts 2025 256
Society 2025 (£m) | Gross Carrying Amount | Loss Allowance | ||||||
Probability of default | Stage 1 | Stage 2 | Stage 3 | Total | Stage 1 | Stage 2 | Stage 3 | Total |
<0.15% | 1,409.6 | 0.9 | - | 1,410.5 | 0.5 | - | - | 0.5 |
0.15% - <0.25% | 4,408.0 | 1.6 | - | 4,409.6 | 0.8 | - | - | 0.8 |
0.25% - <0.5% | 15,438.0 | 1.8 | - | 15,439.8 | 3.6 | - | - | 3.6 |
0.5% - <0.75% | 6,338.2 | 4.9 | - | 6,343.1 | 2.2 | - | - | 2.2 |
0.75% - <2.5% | 2,601.4 | 51.0 | - | 2,652.4 | 1.4 | - | - | 1.4 |
2.5% - <10% | 16.9 | 144.7 | - | 161.6 | - | 0.2 | - | 0.2 |
10% - <100% | - | 432.3 | - | 432.3 | - | 4.9 | - | 4.9 |
Default | - | - | 141.9 | 141.9 | - | - | 7.3 | 7.3 |
Total | 30,212.1 | 637.2 | 141.9 | 30,991.2 | 8.5 | 5.1 | 7.3 | 20.9 |
ECL coverage by stage (%) | 0.03% | 0.80% | 5.14% | 0.07% |
Society 2024 (£m) | Gross Carrying Amount | Loss Allowance | ||||||
Probability of default | Stage 1 | Stage 2 | Stage 3 | Total | Stage 1 | Stage 2 | Stage 3 | Total |
<0.15% | 4,841.6 | 0.4 | - | 4,842.0 | 0.6 | - | - | 0.6 |
0.15% - <0.25% | 11,387.7 | 0.4 | - | 11,388.1 | 1.5 | - | - | 1.5 |
0.25% - <0.5% | 10,063.3 | 5.7 | - | 10,069.0 | 1.8 | - | - | 1.8 |
0.5% - <0.75% | 1,315.8 | 13.0 | - | 1,328.8 | 0.3 | - | - | 0.3 |
0.75% - <2.5% | 430.9 | 65.3 | - | 496.2 | 0.2 | - | - | 0.2 |
2.5% - <10% | 6.7 | 59.4 | - | 66.1 | - | 0.1 | - | 0.1 |
10% - <100% | - | 206.1 | - | 206.1 | - | 2.3 | - | 2.3 |
Default | - | - | 113.5 | 113.5 | - | - | 6.0 | 6.0 |
Total | 28,046.0 | 350.3 | 113.5 | 28,509.8 | 4.4 | 2.4 | 6.0 | 12.8 |
ECL coverage by stage (%) | 0.02% | 0.69% | 5.29% | 0.04% |
2025 | 2024 | |||||
| Gross | ECL | ECL | Gross | ECL | ECL | |
Group | carrying | allowance | coverage | carrying | allowance | coverage |
| amount | £m | % | amount | £m | % | |
| £m | £m | |||||
Over 30 days past due | 73.7 | 2.1 | 2.8% | 62.1 | 1.2 | 1.9% |
In forbearance | 130.2 | 1.1 | 0.8% | 16.5 | 0.1 | 0.6% |
In arrears | 59.4 | 0.9 | 1.5% | 66.8 | 0.6 | 0.9% |
Term expired | 15.7 | - | - | 18.6 | - | - |
Temporary transfer to interest only* | 85.8 | 0.1 | 0.1% | 103.5 | 0.1 | 0.1% |
Increase in PD since origination | 281.8 | 1.2 | 0.4% | 91.3 | 0.5 | 0.5% |
Total | 646.6 | 5.4 | 0.8% | 358.8 | 2.5 | 0.7% |
Performance & Strategy Governance
Financial Statements
Other Information
Skipton Group Annual Report & Accounts 2025 257
2025 | 2024 | |||||
| Gross | ECL | ECL | Gross | ECL | ECL | |
Society | carrying | allowance | coverage | carrying | allowance | coverage |
| amount | £m | % | amount | £m | % | |
| £m | £m | |||||
Over 30 days past due | 70.2 | 1.9 | 2.7% | 59.3 | 1.1 | 1.9% |
In forbearance | 127.0 | 1.1 | 0.9% | 12.6 | 0.1 | 0.8% |
In arrears | 56.7 | 0.8 | 1.4% | 65.0 | 0.6 | 0.9% |
Term expired | 15.7 | 0.0 | 0.0% | 18.6 | - | - |
Temporary transfer to interest only * | 85.8 | 0.1 | 0.1% | 103.5 | 0.1 | 0.1% |
Increase in PD since origination | 281.8 | 1.2 | 0.4% | 91.3 | 0.5 | 0.5% |
Total | 637.2 | 5.1 | 0.8% | 350.3 | 2.4 | 0.7% |
Group | 2025 | 2024 | ||||||
£m | Stage 1 | Stage 2 | Stage 3 | Total | Stage 1 | Stage 2 | Stage 3 | Total |
Prime: | ||||||||
| Residential | 26,835.0 | 513.2 | 109.0 | 27,457.2 | 24,273.8 | 288.6 | 80.1 | 24,642.5 |
| Buy-to-let | 5,239.7 | 91.4 | 19.4 | 5,350.5 | 5,608.3 | 42.1 | 18.3 | 5,668.7 |
| Self build | 7.5 | 0.9 | 0.7 | 9.1 | 8.6 | 0.8 | 1.0 | 10.4 |
| Fast track* | 7.8 | 0.4 | 0.2 | 8.4 | 9.2 | 0.6 | 0.1 | 9.9 |
| Self certified | 113.1 | 35.0 | 13.7 | 161.8 | 145.2 | 21.4 | 15.4 | 182.0 |
Sub -prime^: | ||||||||
| Residential | 2.6 | 1.1 | - | 3.7 | 3.7 | 0.8 | 0.2 | 4.7 |
| Buy-to-let | 3.3 | 0.6 | 0.3 | 4.2 | 5.0 | 0.4 | 0.3 | 5.7 |
| Self certified | 7.6 | 4.0 | 1.0 | 12.6 | 13.5 | 4.1 | 1.3 | 18.9 |
Total | 32,216.6 | 646.6 | 144.3 | 33,007.5 | 30,067.3 | 358.8 | 116.7 | 30,542.8 |
Society | 2025 | 2024 | ||||||
£m | Stage 1 | Stage 2 | Stage 3 | Total | Stage 1 | Stage 2 | Stage 3 | Total |
Prime: | ||||||||
| Residential | 26,183.1 | 511.2 | 109.0 | 26,803.3 | 23,584.1 | 285.0 | 79.8 | 23,948.9 |
| Buy-to-let | 3,887.1 | 84.0 | 17.0 | 3,988.1 | 4,276.7 | 37.2 | 15.4 | 4,329.3 |
| Self build | 7.5 | 0.9 | 0.7 | 9.1 | 8.6 | 0.8 | 1.0 | 10.4 |
| Fast track* | 7.8 | 0.4 | 0.2 | 8.4 | 9.2 | 0.6 | 0.1 | 9.9 |
| Self certified | 113.1 | 35.0 | 13.7 | 161.8 | 145.2 | 21.4 | 15.4 | 182.0 |
Sub -prime^: | ||||||||
| Residential | 2.6 | 1.1 | - | 3.7 | 3.7 | 0.8 | 0.2 | 4.7 |
| Buy-to-let | 3.3 | 0.6 | 0.3 | 4.2 | 5.0 | 0.4 | 0.3 | 5.7 |
| Self certified | 7.6 | 4.0 | 1.0 | 12.6 | 13.5 | 4.1 | 1.3 | 18.9 |
Total | 30,212.1 | 637.2 | 141.9 | 30,991.2 | 28,046.0 | 350.3 | 113.5 | 28,509.8 |
Performance & Strategy Governance
Financial Statements
Other Information
Skipton Group Annual Report & Accounts 2025 258
Indexed loan-to-value information on the Group’s residential loan portfolio is set out below:
Group (£m) | 2025 | 2024 | ||||||
Region | Stage 1 | Stage 2 | Stage 3 | Total | Stage 1 | Stage 2 | Stage 3 | Total |
North | 871.8 | 19.7 | 5.6 | 897.1 | 854.6 | 14.3 | 3.9 | 872.8 |
Yorkshire | 2,445.7 | 50.8 | 9.8 | 2,506.3 | 2,332.1 | 30.2 | 9.8 | 2,372.1 |
East Midlands | 2,199.7 | 52.1 | 8.2 | 2,260.0 | 2,035.7 | 26.7 | 7.2 | 2,069.6 |
East Anglia | 3,186.6 | 69.6 | 16.2 | 3,272.4 | 2,836.3 | 43.8 | 11.3 | 2,891.4 |
London | 6,211.9 | 110.9 | 29.4 | 6,352.2 | 5,732.7 | 54.4 | 22.6 | 5,809.7 |
South East | 5,281.4 | 107.2 | 26.4 | 5,415.0 | 4,847.5 | 57.2 | 21.5 | 4,926.2 |
South West | 2,804.1 | 51.9 | 9.5 | 2,865.5 | 2,695.6 | 29.2 | 6.9 | 2,731.7 |
West Midlands | 2,625.2 | 55.8 | 10.0 | 2,691.0 | 2,381.5 | 31.1 | 7.4 | 2,420.0 |
North West | 2,996.0 | 65.1 | 15.4 | 3,076.5 | 2,821.4 | 37.5 | 13.6 | 2,872.5 |
Wales | 878.4 | 20.2 | 3.9 | 902.5 | 825.6 | 10.3 | 3.9 | 839.8 |
Scotland | 2,012.4 | 39.7 | 8.6 | 2,060.7 | 1,959.1 | 19.8 | 6.7 | 1,985.6 |
Northern Ireland | 8.7 | 1.4 | 1.3 | 11.4 | 11.2 | 0.8 | 1.3 | 13.3 |
Channel Islands | 694.7 | 2.2 | - | 696.9 | 734.0 | 3.5 | 0.6 | 738.1 |
Total | 32,216.6 | 646.6 | 144.3 | 33,007.5 | 30,067.3 | 358.8 | 116.7 | 30,542.8 |
Society (£m) | 2025 | 2024 | ||||||
Region | Stage 1 | Stage 2 | Stage 3 | Total | Stage 1 | Stage 2 | Stage 3 | Total |
North | 867.8 | 19.7 | 5.6 | 893.1 | 850.3 | 14.3 | 3.9 | 868.5 |
Yorkshire | 2,429.4 | 50.8 | 9.8 | 2,490.0 | 2,315.5 | 30.0 | 9.8 | 2,355.3 |
East Midlands | 2,190.6 | 51.8 | 8.2 | 2,250.6 | 2,024.7 | 26.6 | 7.2 | 2,058.5 |
East Anglia | 3,164.8 | 69.5 | 16.2 | 3,250.5 | 2,814.4 | 43.4 | 11.3 | 2,869.1 |
London | 5,357.6 | 105.2 | 27.6 | 5,490.4 | 4,899.8 | 50.4 | 20.3 | 4,970.5 |
South East | 5,145.1 | 107.2 | 26.0 | 5,278.3 | 4,705.0 | 57.0 | 21.5 | 4,783.5 |
South West | 2,771.0 | 51.9 | 9.5 | 2,832.4 | 2,661.5 | 29.2 | 6.9 | 2,697.6 |
West Midlands | 2,556.1 | 55.5 | 9.8 | 2,621.4 | 2,315.4 | 31.0 | 7.1 | 2,353.5 |
North West | 2,863.3 | 64.6 | 15.4 | 2,943.3 | 2,698.9 | 37.5 | 13.6 | 2,750.0 |
Wales | 873.0 | 19.9 | 3.9 | 896.8 | 819.6 | 10.3 | 3.9 | 833.8 |
Scotland | 1,984.7 | 39.7 | 8.6 | 2,033.0 | 1,929.7 | 19.8 | 6.7 | 1,956.2 |
Northern Ireland | 8.7 | 1.4 | 1.3 | 11.4 | 11.2 | 0.8 | 1.3 | 13.3 |
Total | 30,212.1 | 637.2 | 141.9 | 30,991.2 | 28,046.0 | 350.3 | 113.5 | 28,509.8 |
Group (£m) | 2025 | 2024 | ||||||
Loan -to-value | Stage 1 | Stage 2 | Stage 3 | Total | Stage 1 | Stage 2 | Stage 3 | Total |
<40% | 5,526.9 | 119.9 | 20.3 | 5,667.1 | 5,891.7 | 72.6 | 21.0 | 5,985.3 |
40% - 50% | 3,705.0 | 93.6 | 22.7 | 3,821.3 | 4,052.9 | 58.7 | 19.8 | 4,131.4 |
50% - 60% | 4,169.7 | 125.3 | 26.9 | 4,321.9 | 4,442.5 | 63.8 | 32.9 | 4,539.2 |
60% - 70% | 4,367.5 | 106.7 | 23.8 | 4,498.0 | 4,622.4 | 60.2 | 16.6 | 4,699.2 |
70% - 80% | 4,586.0 | 78.7 | 14.5 | 4,679.2 | 4,021.4 | 41.5 | 8.7 | 4,071.6 |
80% - 90% | 6,620.2 | 93.4 | 21.0 | 6,734.6 | 5,324.7 | 46.2 | 10.8 | 5,381.7 |
90% - 100% | 3,181.4 | 27.0 | 11.1 | 3,219.5 | 1,687.3 | 14.5 | 3.0 | 1,704.8 |
>100% | 59.9 | 2.0 | 4.0 | 65.9 | 24.4 | 1.3 | 3.9 | 29.6 |
Total | 32,216.6 | 646.6 | 144.3 | 33,007.5 | 30,067.3 | 358.8 | 116.7 | 30,542.8 |
Performance & Strategy Governance
Financial Statements
Other Information
Skipton Group Annual Report & Accounts 2025 259
Society (£m) | 2025 | 2024 | ||||||
Loan -to-value | Stage 1 | Stage 2 | Stage 3 | Total | Stage 1 | Stage 2 | Stage 3 | Total |
<40% | 5,249.9 | 119.1 | 20.3 | 5,389.3 | 5,611.6 | 71.9 | 21.0 | 5,704.5 |
40% - 50% | 3,425.0 | 93.2 | 22.0 | 3,540.2 | 3,761.8 | 58.7 | 19.4 | 3,839.9 |
50% - 60% | 3,785.2 | 124.1 | 26.4 | 3,935.7 | 4,036.9 | 61.1 | 32.2 | 4,130.2 |
60% - 70% | 3,869.9 | 104.0 | 23.8 | 3,997.7 | 4,091.1 | 57.3 | 16.5 | 4,164.9 |
70% - 80% | 4,169.7 | 76.3 | 13.7 | 4,259.7 | 3,628.3 | 40.7 | 7.3 | 3,676.3 |
80% - 90% | 6,505.1 | 92.4 | 21.0 | 6,618.5 | 5,235.9 | 45.6 | 10.2 | 5,291.7 |
90% - 100% | 3,154.0 | 27.0 | 10.7 | 3,191.7 | 1,663.2 | 14.5 | 3.0 | 1,680.7 |
>100% | 53.3 | 1.1 | 4.0 | 58.4 | 17.2 | 0.5 | 3.9 | 21.6 |
Total | 30,212.1 | 637.2 | 141.9 | 30,991.2 | 28,046.0 | 350.3 | 113.5 | 28,509.8 |
Performance & Strategy Governance
Financial Statements
Other Information
Skipton Group Annual Report & Accounts 2025 260
| Reduced | Transfer to | Term | Total renegotiations | |||||
Group - 2025 | Total | Capitalisation | Payment | interest only | Extension | |||
| £m | £m | £m | £m | £m | £m | % | ||
Stage 1 | ||||||||
| Not past due | 32,216.6 | - | - | - | - | - | - | |
32,216.6 | - | - | - | - | - | - | ||
Stage 2 | ||||||||
| Not past due | 468.4 | 3.8 | 66.8 | 14.3 | - | 84.9 | 18.1 | |
| Past due up to 30 days | 104.5 | 0.3 | 43.3 | 1.6 | - | 45.2 | 43.3 | |
| Over 30 days past due | 73.7 | - | 24.4 | 2.2 | - | 26.6 | 36.1 | |
646.6 | 4.1 | 134.5 | 18.1 | - | 156.7 | 24.2 | ||
Stage 3 | ||||||||
| Not past due | 19.8 | 1.5 | 7.8 | 0.2 | - | 9.5 | 48.0 | |
| Past due up to 90 days | 22.3 | 0.1 | 9.8 | 2.1 | - | 12.0 | 53.8 | |
| Over 90 days past due | 102.2 | 0.7 | 53.9 | 7.5 | - | 62.1 | 60.8 | |
144.3 | 2.3 | 71.5 | 9.8 | - | 83.6 | 57.9 | ||
Gross carrying amount | 33,007.5 | 6.4 | 206.0 | 27.9 | - | 240.3 | 0.7 | |
Loss allowance | (21.6) | (0.1) | (5.2) | (0.3) | - | (5.6) | 25.9 | |
32,985.9 | 6.3 | 200.8 | 27.6 | - | 234.7 | 0.7 |
Performance & Strategy Governance
Financial Statements
Other Information
Skipton Group Annual Report & Accounts 2025 261
| Reduced | Transfer to | Term | Total renegotiations | |||||
Group – 2024 | Total | Capitalisation | Payment | interest only | Extension | |||
| £m | £m | £m | £m | £m | £m | % | ||
Stage 1 | ||||||||
| Not past due | 30,067.3 | 0.3 | 27.8 | 6.0 | - | 34.1 | 0.1 | |
30,067.3 | 0.3 | 27.8 | 6.0 | - | 34.1 | 0.1 | ||
Stage 2 | ||||||||
| Not past due | 224.2 | 0.2 | 24.0 | 7.9 | - | 32.1 | 14.3 | |
| Past due up to 30 days | 72.5 | - | 29.4 | 0.6 | - | 30.0 | 41.4 | |
| Over 30 days past due | 62.1 | 0.3 | 24.4 | 1.4 | - | 26.1 | 42.0 | |
358.8 | 0.5 | 77.8 | 9.9 | - | 88.2 | 24.6 | ||
Stage 3 | ||||||||
| Not past due | 13.8 | 1.1 | 3.2 | 0.2 | - | 4.5 | 32.6 | |
| Past due up to 90 days | 18.0 | 0.2 | 8.9 | 2.0 | - | 11.1 | 61.7 | |
| Over 90 days past due | 84.9 | 0.2 | 46.8 | 5.9 | - | 52.9 | 62.3 | |
116.7 | 1.5 | 58.9 | 8.1 | - | 68.5 | 58.7 | ||
Gross carrying amount | 30,542.8 | 2.3 | 164.5 | 24.0 | - | 190.8 | 0.6 | |
Loss allowance | (13.5) | (0.3) | (3.8) | (0.2) | - | (4.3) | 31.9 | |
30,529.3 | 2.0 | 160.7 | 23.8 | - | 186.5 | 0.6 |
| Reduced | Transfer to | Term | Total renegotiations | |||||
Society - 2025 | Total | Capitalisation | Payment | interest only | Extension | |||
| £m | £m | £m | £m | £m | £m | % | ||
Stage 1 | ||||||||
| Not past due | 30,212.1 | - | - | - | - | - | - | |
30,212.1 | - | - | - | - | - | - | ||
Stage 2 | ||||||||
| Not past due | 465.1 | 3.2 | 64.3 | 14.2 | - | 81.7 | 17.6 | |
| Past due up to 30 days | 101.9 | 0.3 | 43.3 | 1.6 | - | 45.2 | 44.4 | |
| Over 30 days past due | 70.2 | - | 24.4 | 2.2 | - | 26.6 | 37.9 | |
637.2 | 3.5 | 132.0 | 18.0 | - | 153.5 | 24.1 | ||
Stage 3 | ||||||||
| Not past due | 19.8 | 1.5 | 7.8 | 0.2 | - | 9.5 | 48.0 | |
| Past due up to 90 days | 22.3 | 0.1 | 9.8 | 2.1 | - | 12.0 | 53.8 | |
| Over 90 days past due | 99.8 | 0.7 | 53.9 | 7.5 | - | 62.1 | 62.2 | |
141.9 | 2.3 | 71.5 | 9.8 | - | 83.6 | 58.9 | ||
Gross carrying amount | 30,991.2 | 5.8 | 203.5 | 27.8 | - | 237.1 | 0.8 | |
Loss allowance | (20.9) | (0.1) | (5.2) | (0.3) | - | (5.6) | 26.8 | |
30,970.3 | 5.7 | 198.3 | 27.5 | - | 231.5 | 0.7 |
Performance & Strategy Governance
Financial Statements
Other Information
Skipton Group Annual Report & Accounts 2025 262
| Total | Capitalisation | Reduced | Transfer to | Term | Total renegotiations | |||
Society - 2024 | £m | £m | Payment | interest only | Extension | £m | % | |
| £m | £m | £m | ||||||
Stage 1 | ||||||||
Not past due | 28,046.0 | 0.3 | 27.8 | 6.0 | - | 34.1 | 0.1 | |
28,046.0 | 0.3 | 27.8 | 6.0 | - | 34.1 | 0.1 | ||
Stage 2 | ||||||||
Not past due | 220.4 | 0.2 | 22.3 | 5.7 | - | 28.2 | 12.8 | |
Past due up to 30 days | 70.6 | - | 29.4 | 0.6 | - | 30.0 | 42.5 | |
Over 30 days past due | 59.3 | 0.3 | 24.4 | 1.4 | - | 26.1 | 44.0 | |
350.3 | 0.5 | 76.1 | 7.7 | - | 84.3 | 24.1 | ||
Stage 3 | ||||||||
Not past due | 13.8 | 1.1 | 3.2 | 0.2 | - | 4.5 | 32.6 | |
Past due up to 90 days | 18.0 | 0.2 | 8.9 | 2.0 | - | 11.1 | 61.7 | |
Over 90 days past due | 81.7 | 0.2 | 46.8 | 5.9 | - | 52.9 | 64.7 | |
113.5 | 1.5 | 58.9 | 8.1 | - | 68.5 | 60.4 | ||
Gross carrying amount | 28,509.8 | 2.3 | 162.8 | 21.8 | - | 186.9 | 0.7 | |
Loss allowance | (12.8) | (0.3) | (3.8) | (0.2) | - | (4.3) | 33.6 | |
28,497.0 | 2.0 | 159.0 | 21.6 | - | 182.6 | 0.6 |
£m | Group | Society | ||
2025 | 2024 | 2025 | 2024 | |
Stage 1 | 32,206.7 | 30,059.9 | 30,204.9 | 28,041.6 |
Stage 2 | 646.1 | 358.4 | 636.8 | 350.0 |
Stage 3 | 143.6 | 115.8 | 141.2 | 112.6 |
32,996.4 | 30,534.1 | 30,982.9 | 28,504.2 | |
Gross loan balances | 33,007.5 | 30,542.8 | 30,991.2 | 28,509.8 |
Negative equity | 11.1 | 8.7 | 8.3 | 5.6 |
Capped collateral held in respect of possessions (included in stage 3 above) | 2.8 | 2.9 | 2.8 | 2.9 |
Performance & Strategy Governance
Financial Statements
Other Information
Skipton Group Annual Report & Accounts 2025 263
Group & Society | 2025 | 2024 | ||||||
£m | Stage 1 | Stage 2 | Stage 3 | Total | Stage 1 | Stage 2 | Stage 3 | Total |
Not past due | 74.6 | 2.6 | 2.7 | 79.9 | 93.9 | 0.4 | 11.3 | 105.6 |
Up to 30 days | - | 2.8 | - | 2.8 | - | 2.3 | - | 2.3 |
31 to 60 days | - | 2.7 | - | 2.7 | - | 2.1 | - | 2.1 |
61 to 90 days | - | 1.0 | - | 1.0 | - | 1.1 | 0.7 | 1.8 |
Over 90 days | - | - | 5.8 | 5.8 | - | - | 2.5 | 2.5 |
Total | 74.6 | 9.1 | 8.5 | 92.2 | 93.9 | 5.9 | 14.5 | 114.3 |
Group & Society | 2025 | 2024 | ||||||
£m | Stage 1 | Stage 2 | Stage 3 | Total | Stage 1 | Stage 2 | Stage 3 | Total |
Gross carrying amount at 1 January | 93.9 | 5.9 | 14.5 | 114.3 | 91.0 | 37.8 | 6.4 | 135.2 |
Transfers due to changes in credit | ||||||||
risk (note A): | ||||||||
| From stage 1 to stage 2 | (2.5) | 2.5 | - | - | (1.1) | 1.1 | - | - |
| From stage 1 to stage 3 | (2.0) | - | 2.0 | - | (1.4) | - | 1.4 | - |
| From stage 2 to stage 1 | 0.1 | (0.1) | - | - | 19.2 | (19.2) | - | - |
| From stage 2 to stage 3 | - | (0.8) | 0.8 | - | - | (3.4) | 3.4 | - |
| From stage 3 to stage 1 | 0.8 | - | (0.8) | - | - | - | - | - |
Modification of contractual | (3.2) | 2.3 | 0.5 | (0.4) | 0.8 | (8.0) | 6.8 | (0.4) |
cashflows | ||||||||
Decrease due to derecognition and repayments | (12.5) | (0.7) | (7.2) | (20.4) | (14.6) | (2.4) | (3.1) | (20.1) |
Written off | - | - | (1.3) | (1.3) | - | - | (0.4) | (0.4) |
Gross carrying amount at 31 December | 74.6 | 9.1 | 8.5 | 92.2 | 93.9 | 5.9 | 14.5 | 114.3 |
Performance & Strategy Governance
Financial Statements
Other Information
Skipton Group Annual Report & Accounts 2025 264
Group & Society | 2025 | 2024 | ||||||
£m | Stage 1 | Stage 2 | Stage 3 | Total | Stage 1 | Stage 2 | Stage 3 | Total |
Loss allowance at 1 January | 0.2 | 0.2 | 4.3 | 4.7 | 0.6 | 6.6 | 1.8 | 9.0 |
Transfers due to changes in credit | ||||||||
risk: | ||||||||
| From stage 1 to stage 2 | - | 0.1 | - | 0.1 | - | - | - | - |
| From stage 1 to stage 3 | - | - | 0.6 | 0.6 | - | - | - | - |
| From stage 2 to stage 1 | - | - | - | - | - | (1.9) | - | (1.9) |
| From stage 2 to stage 3 | - | - | - | - | - | (0.4) | 0.4 | - |
Remeasurements within existing | 0.2 | - | 0.1 | 0.3 | (0.3) | (0.1) | - | (0.4) |
stage | ||||||||
Decrease due to derecognition and repayments | - | - | (0.1) | (0.1) | (0.1) | (0.9) | (1.1) | (2.1) |
Changes due to modification | - | - | (0.1) | (0.1) | - | (3.1) | 3.3 | 0.2 |
without derecognition | ||||||||
Written off | - | - | (2.9) | (2.9) | - | - | (0.1) | (0.1) |
Loss allowance at 31 December | 0.4 | 0.3 | 1.9 | 2.6 | 0.2 | 0.2 | 4.3 | 4.7 |
ECL coverage (%) | 0.54% | 3.30% | 22.35% | 2.82% | 0.21% | 3.39% | 29.66% | 4.11% |
Group & Society (£m) | 2025 | 2024 | ||||||
Industry analysis | Stage 1 | Stage 2 | Stage 3 | Total | Stage 1 | Stage 2 | Stage 3 | Total |
Leisure and hotels | 5.7 | 0.5 | - | 6.2 | 6.4 | 0.6 | 5.1 | 12.1 |
Retail | 1.9 | 0.3 | 0.2 | 2.4 | 2.1 | 0.3 | 0.2 | 2.6 |
Nursing/residential homes | 1.6 | - | - | 1.6 | 1.7 | - | 2.2 | 3.9 |
Offices | 1.1 | - | - | 1.1 | 1.2 | - | - | 1.2 |
Commercial and industrial units | 63.8 | 8.3 | 8.3 | 80.4 | 81.9 | 5.0 | 7.0 | 93.9 |
Miscellaneous | 0.5 | - | - | 0.5 | 0.6 | - | - | 0.6 |
Total | 74.6 | 9.1 | 8.5 | 92.2 | 93.9 | 5.9 | 14.5 | 114.3 |
Performance & Strategy Governance
Financial Statements
Other Information
Skipton Group Annual Report & Accounts 2025 265
Group & Society (£m) | 2025 | 2024 | ||||||
Geographical analysis (Region) | Stage 1 | Stage 2 | Stage 3 | Total | Stage 1 | Stage 2 | Stage 3 | Total |
North | 1.3 | 1.7 | - | 3.0 | 2.9 | 0.3 | - | 3.2 |
Yorkshire | 3.7 | 0.5 | 1.1 | 5.3 | 6.2 | 0.3 | 5.7 | 12.2 |
East Midlands | 2.1 | - | 2.2 | 4.3 | 3.2 | - | 2.3 | 5.5 |
East Anglia | 8.4 | 0.1 | 0.1 | 8.6 | 9.6 | 0.1 | - | 9.7 |
London | 19.0 | 2.9 | 1.2 | 23.1 | 22.8 | 2.1 | 0.7 | 25.6 |
South East | 12.4 | 1.6 | 0.4 | 14.4 | 15.5 | 1.2 | - | 16.7 |
South West | 11.2 | - | 0.4 | 11.6 | 12.0 | 0.4 | 0.4 | 12.8 |
West Midlands | 5.3 | 1.1 | 0.3 | 6.7 | 7.0 | 0.6 | 2.3 | 9.9 |
North West | 8.7 | 1.2 | 2.0 | 11.9 | 10.5 | 0.9 | 2.1 | 13.5 |
Wales | 2.3 | - | 0.5 | 2.8 | 2.4 | - | 0.7 | 3.1 |
Scotland | 0.2 | - | 0.3 | 0.5 | 1.8 | - | 0.3 | 2.1 |
Total | 74.6 | 9.1 | 8.5 | 92.2 | 93.9 | 5.9 | 14.5 | 114.3 |
Group & Society (£m) | 2025 | 2024 | ||||||
Loan -to-value | Stage 1 | Stage 2 | Stage 3 | Total | Stage 1 | Stage 2 | Stage 3 | Total |
<40% | 24.4 | 2.5 | 1.2 | 28.1 | 27.4 | 1.0 | 2.0 | 30.4 |
40% - 50% | 12.7 | 1.4 | 1.2 | 15.3 | 18.5 | 1.1 | 0.6 | 20.2 |
50% - 60% | 14.3 | 1.2 | - | 15.5 | 16.6 | 1.2 | 1.2 | 19.0 |
60% - 70% | 5.1 | 1.9 | 0.2 | 7.2 | 6.3 | 1.4 | 0.1 | 7.8 |
70% - 80% | 6.0 | 0.9 | - | 6.9 | 7.4 | 0.5 | 1.3 | 9.2 |
80% - 90% | 8.7 | 1.2 | 0.8 | 10.7 | 9.3 | 0.3 | - | 9.6 |
90% - 100% | 2.2 | - | - | 2.2 | 5.4 | 0.4 | - | 5.8 |
>100% | 1.2 | - | 5.1 | 6.3 | 3.0 | - | 9.3 | 12.3 |
Total | 74.6 | 9.1 | 8.5 | 92.2 | 93.9 | 5.9 | 14.5 | 114.3 |
Performance & Strategy Governance
Financial Statements
Other Information
Skipton Group Annual Report & Accounts 2025 266
| 2025 | ||||||||
Group & Society | Reduced | Transfer to | Total renegotiations | |||||
| Total | Capitalisation | Payment | interest only | |||||
| £m | £m | £m | £m | £m | % | |||
Stage 1 | ||||||||
| Not past due | 74.6 | - | - | - | - | - | ||
74.6 | - | - | - | - | - | |||
Stage 2 | ||||||||
| Not past due | 2.6 | 0.8 | 0.9 | 0.9 | 2.6 | 100.0 | ||
| Past due up to 30 days | 2.8 | - | 0.3 | - | 0.3 | 10.7 | ||
| Over 30 days past due | 3.7 | 0.8 | - | - | 0.8 | 21.6 | ||
9.1 | 1.6 | 1.2 | 0.9 | 3.7 | 40.7 | |||
Stage 3 | ||||||||
| Not past due | 2.7 | - | 0.1 | 1.2 | 1.3 | 48.1 | ||
| Past due up to 90 days | - | - | - | - | - | - | ||
| Over 90 days past due | 5.8 | - | 1.0 | 2.8 | 3.8 | 65.5 | ||
8.5 | - | 1.1 | 4.0 | 5.1 | 60.0 | |||
Gross carrying amount | 92.2 | 1.6 | 2.3 | 4.9 | 8.8 | 9.5 | ||
Loss allowance | (2.6) | (0.1) | (0.1) | (0.7) | (0.9) | 34.6 | ||
89.6 | 1.5 | 2.2 | 4.2 | 7.9 | 8.8 |
| 2024 | ||||||
Group & Society | Reduced | Transfer to | Total renegotiations | |||
| Total | Capitalisation | Payment | interest only | |||
| £m | £m | £m | £m | £m | % | |
Stage 1 | ||||||
| Not past due | 93.9 | 0.9 | 0.4 | 0.5 | 1.8 | 1.9 |
93.9 | 0.9 | 0.4 | 0.5 | 1.8 | 1.9 | |
Stage 2 | ||||||
| Not past due | 0.4 | - | - | 0.4 | 0.4 | 100.0 |
| Past due up to 30 days | 2.3 | - | - | 0.1 | 0.1 | 4.3 |
| Over 30 days past due | 3.2 | 0.9 | 0.5 | - | 1.4 | 43.8 |
5.9 | 0.9 | 0.5 | 0.5 | 1.9 | 32.2 | |
Stage 3 | ||||||
| Not past due | 11.3 | - | - | 8.4 | 8.4 | 74.3 |
| Past due up to 90 days | 0.7 | - | - | - | - | - |
| Over 90 days past due | 2.5 | - | 0.6 | 0.7 | 1.3 | 52.0 |
14.5 | - | 0.6 | 9.1 | 9.7 | 66.9 | |
Gross carrying amount | 114.3 | 1.8 | 1.5 | 10.1 | 13.4 | 11.7 |
Loss allowance | (4.7) | - | - | (3.8) | (3.8) | 80.9 |
109.6 | 1.8 | 1.5 | 6.3 | 9.6 | 8.8 |
Performance & Strategy Governance
Financial Statements
Other Information
Skipton Group Annual Report & Accounts 2025 267
Group & Society (£m) | 2025 | 2024 |
Stage 1 | 74.4 | 93.2 |
Stage 2 | 9.1 | 5.9 |
Stage 3 | 7.0 | 12.3 |
Total | 90.5 | 111.4 |
Gross loan balances | 92.2 | 114.3 |
Negative equity | 1.7 | 2.9 |
Capped collateral held in respect of possessions (included within stage 3 above) | 0.1 | - |
2025 | 2024 | |||||
Group | Gross | ECL | Net | Gross | ECL | Net |
£m | carrying | Allowance | carrying | carrying | allowance | carrying |
| amount | amount | amount | amount | |||
Debt factoring advances | 200.6 | (1.4) | 199.2 | 190.0 | (1.4) | 188.6 |
Other loans | 45.3 | - | 45.3 | 48.2 | - | 48.2 |
Total | 245.9 | (1.4) | 244.5 | 238.2 | (1.4) | 236.8 |
Performance & Strategy Governance
Financial Statements
Other Information
Group | 2025 | 2024 | ||||||
£m | Stage 1 | Stage 2 | Stage 3 | Total | Stage 1 | Stage 2 | Stage 3 | Total |
Gross carrying amount at 1 January | 234.5 | 2.3 | 1.4 | 238.2 | 219.6 | 4.3 | 0.5 | 224.4 |
Transfers due to changes in credit risk (note A): | ||||||||
| From stage 1 to stage 2 | (1.1) | 1.1 | - | - | (3.4) | 3.4 | - | - |
| From stage 1 to stage 3 | - | - | - | - | (0.4) | - | 0.4 | - |
| From stage 2 to stage 1 | 1.0 | (1.0) | - | - | 2.3 | (2.3) | - | - |
| From stage 2 to stage 3 | - | (0.7) | 0.7 | - | - | (1.6) | 1.6 | - |
| From stage 3 to stage 2 | - | 1.0 | (1.0) | - | - | 0.3 | (0.3) | - |
| From stage 3 to stage 1 | 0.4 | - | (0.4) | - | 0.3 | - | (0.3) | - |
Modification of contractual | - | - | - | - | - | - | - | - |
cashflows | ||||||||
Increases due to origination | 68.8 | - | - | 68.8 | 74.2 | - | - | 74.2 |
Decrease due to derecognition | (60.3) | (0.5) | - | (60.8) | (58.1) | (1.8) | - | (59.9) |
and repayments | ||||||||
Write -offs | - | - | (0.3) | (0.3) | - | - | (0.6) | (0.6) |
Other movements | - | - | - | - | - | - | 0.1 | 0.1 |
Gross carrying amount at 31 | 243.3 | 2.2 | 0.4 | 245.9 | 234.5 | 2.3 | 1.4 | 238.2 |
December |
Skipton Group Annual Report & Accounts 2025 268
Performance & Strategy Governance
Financial Statements
Other Information
Group | 2025 | 2024 | ||||||
£m | Stage 1 | Stage 2 | Stage 3 | Total | Stage 1 | Stage 2 | Stage 3 | Total |
Loss allowance at 1 January | 0.2 | 0.6 | 0.6 | 1.4 | 0.2 | 1.1 | 0.3 | 1.6 |
Transfers due to changes in credit risk: | ||||||||
| From stage 1 to stage 2 | - | 0.9 | - | 0.9 | (0.1) | 1.0 | - | 0.9 |
| From stage 2 to stage 1 | - | (0.2) | - | (0.2) | - | (0.3) | - | (0.3) |
| From stage 2 to stage 3 | - | (0.7) | 0.7 | - | - | (1.0) | 1.0 | - |
| From stage 3 to stage 2 | - | 0.6 | (0.6) | - | - | - | - | - |
| From stage 3 to stage 1 | - | - | - | - | 0.1 | - | (0.1) | - |
Remeasurements within existing | 0.1 | (0.5) | - | (0.4) | - | (0.2) | - | (0.2) |
stage | ||||||||
Write -offs | - | - | (0.3) | (0.3) | - | - | (0.6) | (0.6) |
Loss allowance at 31 December | 0.3 | 0.7 | 0.4 | 1.4 | 0.2 | 0.6 | 0.6 | 1.4 |
Group | 2025 | 2024 | |||||
£m | Stage 1 | Stage 2 | Total | Stage 1 | Stage 2 | Total | |
Not past due | 45.2 | - | 45.2 | 48.2 | - | 48.2 | |
Up to 30 days | - | 0.1 | 0.1 | - | - | - | |
Total | 45.2 | 0.1 | 45.3 | 48.2 | - | 48.2 |
Skipton Group Annual Report & Accounts 2025 269
Group | Society | |||||||
Rating | 2025 | 2025 | 2024 | 2024 | 2025 | 2025 | 2024 | 2024 |
| £m | % | £m | % | £m | % | £m | % | |
Aaa | 2,818.1 | 47.1 | 2,429.6 | 36.3 | 3,040.5 | 51.2 | 2,666.1 | 40.0 |
Aa1 | 212.6 | 3.6 | 268.2 | 4.0 | 179.2 | 3.0 | 268.2 | 4.0 |
Aa2 | 0.1 | - | 0.1 | - | - | - | - | - |
Aa3 | 2,611.1 | 43.6 | 3,605.1 | 53.8 | 2,416.1 | 40.7 | 3,336.4 | 50.0 |
A1 | 85.3 | 1.4 | 117.3 | 1.8 | 40.9 | 0.7 | 72.1 | 1.1 |
A2 | 1.1 | - | 1.0 | - | - | - | - | - |
Unrated | 254.6 | 4.3 | 273.5 | 4.1 | 263.6 | 4.4 | 325.7 | 4.9 |
Total | 5,982.9 | 100.0 | 6,694.8 | 100.0 | 5,940.3 | 100.0 | 6,668.5 | 100.0 |
Group | Society | |||||||
Industry sector / asset class | 2025 | 2025 | 2024 | 2024 | 2025 | 2025 | 2024 | 2024 |
| £m | % | £m | % | £m | % | £m | % | |
Cash in hand and balances with the Bank of England | 1,360.2 | 22.7 | 1,930.6 | 28.9 | 1,360.2 | 22.9 | 1,930.6 | 29.0 |
Loans and advances to banks and building societies | 353.3 | 5.9 | 414.6 | 6.2 | 304.7 | 5.1 | 397.8 | 6.0 |
Gilts | 500.5 | 8.4 | 1,086.5 | 16.2 | 500.5 | 8.4 | 1,086.5 | 16.3 |
Certificates of deposit | - | - | - | - | - | - | - | - |
Fixed rate bonds | 1,552.0 | 26.0 | 1,274.9 | 19.0 | 1,552.0 | 26.2 | 1,274.9 | 19.1 |
Floating rate notes | 11.0 | 0.2 | - | - | - | - | - | - |
Treasury bills | 733.4 | 12.9 | 598.2 | 8.9 | 557.0 | 9.4 | 321.2 | 4.8 |
Covered bonds | 813.5 | 13.6 | 770.1 | 11.5 | 813.5 | 13.7 | 770.1 | 11.5 |
Residential mortgage backed | 619.0 | 10.3 | 619.9 | 9.3 | 852.4 | 14.3 | 887.4 | 13.3 |
securities | ||||||||
Total | 5,982.9 | 100.0 | 6,694.8 | 100.0 | 5,940.3 | 100.0 | 6,668.5 | 100.0 |
Performance & Strategy Governance
Financial Statements
Other Information
Skipton Group Annual Report & Accounts 2025 270
Group | Society | |||||||
Geographical exposure (Region) | 2025 | 2025 | 2024 | 2024 | 2025 | 2025 | 2024 | 2024 |
| £m | % | £m | % | £m | % | £m | % | |
UK | 4,344.1 | 72.7 | 5,331.5 | 79.7 | 4,388.2 | 73.8 | 5,393.6 | 81.0 |
Rest of Europe | 419.7 | 7.0 | 327.9 | 4.9 | 389.7 | 6.6 | 293.3 | 4.4 |
Supranationals: | ||||||||
| Europe | 226.7 | 3.8 | 122.4 | 1.8 | 215.6 | 3.6 | 122.4 | 1.8 |
| Global | 504.5 | 8.4 | 528.4 | 7.9 | 504.5 | 8.5 | 528.4 | 7.9 |
| Africa | 56.1 | 0.9 | 28.4 | 0.4 | 56.1 | 0.9 | 28.4 | 0.4 |
| Asia | 163.4 | 2.7 | 135.2 | 2.0 | 163.4 | 2.8 | 135.2 | 2.0 |
| South America | 145.8 | 2.4 | 117.7 | 1.8 | 145.8 | 2.5 | 117.7 | 1.8 |
North America | 118.8 | 2.0 | 100.2 | 1.5 | 77.0 | 1.3 | 49.5 | 0.7 |
Rest of World | 3.8 | 0.1 | 3.1 | - | - | - | - | - |
Total | 5,982.9 | 100.0 | 6,694.8 | 100.0 | 5,940.3 | 100.0 | 6,668.5 | 100.0 |
£m | Group | Society | |||
2025 | 2024 | 2025 | 2024 | ||
Gross carrying amount | 76.3 | 71.0 | 1.5 | 1.9 | |
Loss allowance | (2.7) | (2.2) | - | - | |
Net carrying amount | 73.6 | 68.8 | 1.5 | 1.9 |
£m | Group | Society | ||||
2025 | 2024 | 2025 | 2024 | |||
Loss allowance at 1 January | 2.2 | 2.4 | - | - | ||
Net allowances made during the year | 1.4 | 0.8 | 0.1 | - | ||
Write -offs | (0.9) | (1.0) | (0.1) | - | ||
Loss allowance at 31 December | 2.7 | 2.2 | - | - |
£m | Group | Society | |||
2025 | 2024 | 2025 | 2024 | ||
Not past due | 42.6 | 38.3 | - | - | |
Up to 30 days past due | 18.1 | 19.5 | 0.6 | 0.5 | |
31 to 120 days past due | 10.1 | 9.5 | 0.5 | 1.0 | |
Over 120 days past due | 5.5 | 3.7 | 0.4 | 0.4 | |
Total | 76.3 | 71.0 | 1.5 | 1.9 |
Performance & Strategy Governance
Financial Statements
Other Information
Skipton Group Annual Report & Accounts 2025 271
Group | 2024 | |||
£m | As reported | Netting | Cash | Net amounts |
| within SoFP | agreements | collateral | after offsetting | |
Financial assets | ||||
Derivative financial instruments | 752.1 | (204.2) | (557.3) | - |
Financial liabilities | ||||
Derivative financial instruments | 225.1 | (204.2) | (18.1) | 2.8 |
Society | 2025 | |||
£m | As reported | Netting | Cash | Net amounts |
| within SoFP | agreements | collateral | after offsetting | |
Financial assets | ||||
Derivative financial instruments | 333.1 | (189.4) | (141.3) | 2.4 |
Financial liabilities | ||||
Derivative financial instruments | 205.0 | (189.4) | (14.6) | 1.0 |
Group | 2025 | |||
£m | As reported | Netting | Cash | Net amounts |
| within SoFP | agreements | collateral | after offsetting | |
Financial assets | ||||
Derivative financial instruments | 350.8 | (180.5) | (141.5) | 28.8 |
Financial liabilities | ||||
Derivative financial instruments | 186.2 | (180.5) | (5.7) | - |
Performance & Strategy Governance
Financial Statements
Other Information
Skipton Group Annual Report & Accounts 2025 272
Society | 2024 | ||||
£m | As reported | Netting | Cash | Net amounts | |
| within SoFP | agreements | collateral | after offsetting | ||
Financial assets | |||||
Derivative financial instruments | 743.0 | (208.3) | (557.3) | - | |
Financial liabilities | |||||
Derivative financial instruments | 282.2 | (208.3) | (70.4) | 3.5 |
Performance & Strategy Governance
Financial Statements
Other Information
Skipton Group Annual Report & Accounts 2025 273
Group | Amortised | 2025 | Amortised | 2024 | ||||
£m | FVOCI | FVTPL | Total | FVOCI | FVTPL | Total | ||
| cost | cost | |||||||
Cash in hand and balances with the Bank of England | 1,360.2 | - | - | 1,360.2 | 1,930.6 | - | - | 1,930.6 |
Loans and advances | 353.3 | - | - | 353.3 | 414.6 | - | - | 414.6 |
to credit institutions | ||||||||
Debt securities | - | 4,269.4 | - | 4,269.4 | - | 4,349.6 | - | 4,349.6 |
Derivative financial | - | - | 350.8 | 350.8 | - | - | 752.1 | 752.1 |
Instruments | ||||||||
Loans and advances | 33,378.9 | - | 0.8 | 33,379.7 | 30,601.1 | - | 0.9 | 30,602.0 |
to customers | ||||||||
Equity release | - | - | 263.1 | 263.1 | - | - | 277.2 | 277.2 |
portfolio | ||||||||
Equity share | - | - | 18.3 | 18.3 | - | - | 16.9 | 16.9 |
investments | ||||||||
Trade receivables | 73.6 | - | - | 73.6 | 68.8 | - | - | 68.8 |
Share warrants | - | - | - | - | - | - | 21.9 | 21.9 |
Loan to defined | ||||||||
benefit pension | - | - | 10.9 | 10.9 | - | - | - | - |
scheme | ||||||||
Other assets | - | - | - | - | 0.1 | - | - | 0.1 |
Total financial | 35,166.0 | 4,269.4 | 643.9 | 40,079.3 | 33,015.2 | 4,349.6 | 1,069.0 | 38,433.8 |
assets | ||||||||
Other non -financial | 664.9 | 581.5 | ||||||
assets | ||||||||
Total assets | 40,744.2 | 39,015.3 | ||||||
Shares | 30,526.3 | - | - | 30,526.3 | 28,268.5 | - | - | 28,268.5 |
Amounts owed to credit institutions | 3,046.8 | - | - | 3,046.8 | 4,350.7 | - | - | 4,350.7 |
and other customers | ||||||||
Debt securities in issue | 3,361.9 | - | - | 3,361.9 | 2,435.3 | - | - | 2,435.3 |
Derivative financial | - | - | 186.2 | 186.2 | - | - | 225.1 | 225.1 |
Instruments | ||||||||
Lease liabilities | 110.3 | - | - | 110.3 | 92.1 | - | - | 92.1 |
Trade payables | 14.4 | - | - | 14.4 | 11.0 | - | - | 11.0 |
Fair value of put | - | - | 1.0 | 1.0 | - | - | 4.1 | 4.1 |
option obligation | ||||||||
Subordinated | 356.0 | - | - | 356.0 | 690.2 | - | - | 690.2 |
liabilities | ||||||||
Subscribed capital | 15.2 | - | - | 15.2 | 41.6 | - | - | 41.6 |
Total financial | 37,430.9 | - | 187.2 | 37,618.1 | 35,889.4 | - | 229.2 | 36,118.6 |
liabilities | ||||||||
Other non -financial | 261.5 | 229.3 | ||||||
liabilities | ||||||||
Total liabilities | 37,879.6 | 36,347.9 |
Performance & Strategy Governance
Financial Statements
Other Information
Skipton Group Annual Report & Accounts 2025 274
Society | 2025 | 2024 | ||||||
£m | Amortised | FVOCI | FVTPL | Total | Amortised | FVOCI | FVTPL | Total |
| cost | cost | |||||||
Cash in hand and balances | 1,360.2 | - | - | 1,360.2 | 1,930.6 | - | - | 1,930.6 |
with the Bank of England | ||||||||
Loans and advances | 304.7 | - | - | 304.7 | 397.8 | - | - | 397.8 |
to credit institutions | ||||||||
Debt securities | - | 4,201.9 | 73.5 | 4,275.4 | - | 4,269.8 | 70.3 | 4,340.1 |
Derivative financial | - | - | 333.1 | 333.1 | - | - | 743.0 | 743.0 |
instruments | ||||||||
Loans and advances | 31,121.3 | - | 0.8 | 31,122.1 | 28,334.9 | - | 0.9 | 28,335.8 |
to customers | ||||||||
Equity release | - | - | 263.1 | 263.1 | - | - | 277.2 | 277.2 |
portfolio | ||||||||
Loans to subsidiary | 454.7 | - | - | 454.7 | 403.9 | - | - | 403.9 |
undertakings | ||||||||
Trade receivables | 1.5 | - | - | 1.5 | 1.9 | - | - | 1.9 |
Loan to defined | ||||||||
benefit pension | - | - | 10.9 | 10.9 | - | - | - | - |
scheme | ||||||||
Total financial | 33,242.4 | 4,201.9 | 681.4 | 38,125.7 | 31,069.1 | 4,269.8 | 1,091.4 | 36,430.3 |
assets | ||||||||
Other non -financial | 201.2 | 198.0 | ||||||
assets | ||||||||
Total assets | 38,326.9 | 36,628.3 | ||||||
Shares | 30,524.3 | - | - | 30,524.3 | 28,254.1 | - | - | 28,254.1 |
Amounts owed to credit institutions | 1,685.0 | - | - | 1,685.0 | 3,069.5 | - | - | 3,069.5 |
and other customers | ||||||||
Debt securities in issue | 2,955.0 | - | - | 2,955.0 | 1,930.1 | - | - | 1,930.1 |
Derivative financial | - | - | 205.0 | 205.0 | - | - | 282.2 | 282.2 |
Instruments | ||||||||
Lease liabilities | 8.2 | - | - | 8.2 | 8.6 | - | - | 8.6 |
Trade payables | 3.4 | - | - | 3.4 | 2.8 | - | - | 2.8 |
Subordinated | 356.0 | - | - | 356.0 | 690.2 | - | - | 690.2 |
liabilities | ||||||||
Subscribed capital | 15.2 | - | - | 15.2 | 41.6 | - | - | 41.6 |
Total financial | 35,547.1 | - | 205.0 | 35,752.1 | 33,996.9 | - | 282.2 | 34,279.1 |
liabilities | ||||||||
Other non -financial | 46.7 | 43.8 | ||||||
liabilities | ||||||||
Total liabilities | 35,798.8 | 34,322.9 |
Performance & Strategy Governance
Financial Statements
Other Information
Skipton Group Annual Report & Accounts 2025 275
Performance & Strategy Governance
Financial Statements
Other Information
Skipton Group Annual Report & Accounts 2025 276
Group | 2025 | 2024 | ||||||
£m | Level 1 | Level 2 | Level 3 | Total | Level 1 | Level 2 | Level 3 | Total |
Financial assets | ||||||||
Financial assets | ||||||||
held at FVOCI: | ||||||||
| Debt securities | 4,269.4 | - | - | 4,269.4 | 4,349.6 | - | - | 4,349.6 |
Financial assets at FVTPL: | ||||||||
| Equity share | - | - | 18.3 | 18.3 | - | - | 16.9 | 16.9 |
| investments | ||||||||
| Derivative | ||||||||
| financial | - | 335.2 | 15.6 | 350.8 | - | 736.8 | 15.3 | 752.1 |
| Instruments | ||||||||
| Equity release | - | - | 263.1 | 263.1 | - | - | 277.2 | 277.2 |
| portfolio | ||||||||
Loans and advances to customers | - | - | 0.8 | 0.8 | - | - | 0.9 | 0.9 |
| Share warrants | - | - | - | - | - | - | 21.9 | 21.9 |
| Loan to defined | ||||||||
| benefit pension | - | - | 10.9 | 10.9 | - | - | - | - |
| scheme | 4,269.4 | 335.2 | 308.7 | 4,913.3 | 4,349.6 | 736.8 | 332.2 | 5,418.6 |
Financial liabilities | ||||||||
Financial liabilities | ||||||||
at FVTPL: | ||||||||
| Derivative | ||||||||
| financial | - | 178.4 | 7.8 | 186.2 | - | 209.0 | 16.1 | 225.1 |
| Instruments | ||||||||
| Fair value of put | - | - | 1.0 | 1.0 | - | - | 4.1 | 4.1 |
| option Obligation | - | 178.4 | 8.8 | 187.2 | - | 209.0 | 20.2 | 229.2 |
4,269.4 | 156.8 | 299.9 | 4,726.1 | 4,349.6 | 527.8 | 312.0 | 5,189.4 |
Performance & Strategy Governance
Financial Statements
Other Information
Skipton Group Annual Report & Accounts 2025 277
Society | 2025 | 2024 (restated*) | |||||||
£m | Level 1 | Level 2 | Level 3 | Total | Level 1 | Level 2 | Level 3 | Total | |
Financial assets | |||||||||
Financial assets | |||||||||
held at FVOCI: | |||||||||
| Debt securities | 4,201.9 | - | - | 4,201.9 | 4,269.8 | - | - | 4,269.8 | |
Financial assets at FVTPL: | |||||||||
| Derivative | |||||||||
| financial | - | 315.1 | 18.0 | 333.1 | - | 727.7 | 15.3 | 743.0 | |
| Instruments | |||||||||
Debt securities* | - | - | 73.5 | 73.5 | - | - | 70.3 | 70.3 | |
| Equity release | - | - | 263.1 | 263.1 | - | - | 277.2 | 277.2 | |
| portfolio | |||||||||
Loans and advances to customers | - | - | 0.8 | 0.8 | - | - | 0.9 | 0.9 | |
Loan to defined | |||||||||
benefit pension | - | - | 10.9 | 10.9 | - | - | - | - | |
| scheme | 4,201.9 | 315.1 | 366.3 | 4,883.3 | 4,269.8 | 727.7 | 363.7 | 5,361.2 | |
Financial liabilities | |||||||||
Financial liabilities | |||||||||
at FVTPL: | |||||||||
| Derivative | |||||||||
| financial | - | 197.2 | 7.8 | 205.0 | - | 261.7 | 20.5 | 282.2 | |
| Instruments | - | 197.2 | 7.8 | 205.0 | - | 261.7 | 20.5 | 282.2 | |
4,201.9 | 117.9 | 358.5 | 4,678.3 | 4,269.8 | 466.0 | 343.2 | 5,079.0 |
Performance & Strategy Governance
Financial Statements
Other Information
Skipton Group Annual Report & Accounts 2025 278
Group 2024 | Equity | Equity | Loans and | Derivative | Fair value of | Share | |
£m | share | release | advances | financial | put option | warrants | Total |
| Investments | portfolio | to customers | instruments | obligation | |||
At 1 January | 10.5 | 293.3 | 0.9 | (22.7) | (3.5) | 15.1 | 293.6 |
Gain / (loss) | |||||||
recognised in Income Statement | 1.1 A | (12.6) B | - | 21.9 C | (0.3) D | 5.9 E | 16.0 |
Revaluations to goodwill | - | - | - | - | (0.3) | - | (0.3) |
Accrued interest | - | 2.6 G | 0.1 G | - | - | 2.7 | |
Repayments | - | (4.3) | (0.1) | - | - | - | (4.4) |
Realised losses | - | (1.8) H | - | - | - | - | (1.8) |
Additions / Disposals / | 5.3 | - | - | - | - | 0.9 | 6.2 |
Other At 31 December | 16.9 | 277.2 | 0.9 | (0.8) | (4.1) | 21.9 | 312.0 |
Group 2025 | Equity | Equity | Loans and | Derivative | Fair value of | Share | Loan to defined | |
£m | share | release | advances | financial | put option | warrants | benefit pension | Total |
investments portfolio | to customers | instruments | obligation | scheme | ||||
At 1 January | 16.9 | 277.2 | 0.9 | (0.8) | (4.1) | 21.9 | - | 312.0 |
Gain / (loss) | ||||||||
recognised in Income | 0.4 A | (14.5) B | - | 8.1 C | (0.2) D | 5.6 E | (2.2) F | (2.8) |
Statement | ||||||||
Revaluations to goodwill | - | - | - | - | (0.8) | - | - | (0.8) |
Accrued interest | - | 5.7 G | 0.1 G | 0.5 G | - | - | 0.8 G | 7.1 |
Repayments | - | (4.0) | (0.2) | - | - | - | (2.3) | (6.5) |
Realised losses | - | (1.3) H | - | - | - | - | - | (1.3) |
Exercise of put | ||||||||
options by non - controlling | - | - | - | - | 4.2 | - | - | 4.2 |
shareholders | ||||||||
Additions / Disposals | 1.0 | - | - | - | (0.1) | (27.5) | 14.6 | (12.0) |
/ Other At 31 December | 18.3 | 263.1 | 0.8 | 7.8 | (1.0) | - | 10.9 | 299.9 |
Performance & Strategy Governance
Financial Statements
Other Information
Skipton Group Annual Report & Accounts 2025 279
Loans and | Loan to | |||||
Society 2025 | Equity | advances | Derivative | Debt | defined | |
£m | release | to | financial | securities | benefit | Total |
portfolio | customers | instruments | pension | |||
| scheme | ||||||
At 1 January | 277.2 | 0.9 | (5.2) | 70.3 | - | 343.2 |
(Loss) / gain recognised in Income Statement | (14.5) A | - | 14.9 B | 3.2 C | (2.2) D | 1.4 |
Accrued interest | 5.7 E | 0.1 E | 0.5 E | - | 0.8 E | 7.1 |
Repayments | (4.0) | (0.2) | - | - | (2.3) | (6.5) |
Realised losses | (1.3) F | - | - | - | - | (1.3) |
Additions | - | - | - | - | 14.6 | 14.6 |
At 31 December | 263.1 | 0.8 | 10.2 | 73.5 | 10.9 | 358.5 |
Society 2024 (restated*) | Equity | Loans and | Derivative | Debt | ||
£m | release | advances | financial | securities* | Total | |
| portfolio | to customers instruments | |||||
At 1 January | 293.3 | 0.9 | (34.2) | - | 260.0 | |
(Loss) / gain recognised in Income Statement | (12.6) A | - | 29.0 B | (4.0) C | 12.4 | |
Accrued interest | 2.6 E | 0.1 E | - | - | 2.7 | |
Repayments | (4.3) | (0.1) | - | - | (4.4) | |
Realised losses | (1.8) F | - | - | - | (1.8) | |
Additions | - | - | - | 74.3 | 74.3 | |
At 31 December | 277.2 | 0.9 | (5.2) | 70.3 | 343.2 | |
Performance & Strategy Governance
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Other Information
Skipton Group Annual Report & Accounts 2025 280
Performance & Strategy Governance
Financial Statements
Other Information
Skipton Group Annual Report & Accounts 2025 281
£m | Group 2025 | Society 2025 | ||
Carrying Value | Fair Value | Carrying Value | Fair Value | |
Financial assets | ||||
Cash in hand and balances with the Bank of England | 1,360.2 | 1,360.2 | 1,360.2 | 1,360.2 |
Loans and advances to credit institutions | 353.3 | 353.3 | 304.7 | 304.7 |
Loans and advances to customers | 33,378.9 | 33,609.2 | 31,121.3 | 31,324.5 |
Trade receivables | 73.6 | 73.6 | 1.5 | 1.5 |
Loans to subsidiary undertakings | - | - | 454.7 | 454.7 |
35,166.0 | 35,396.3 | 33,242.4 | 33,445.6 | |
Financial liabilities | ||||
Shares | 30,526.3 | 30,535.0 | 30,524.3 | 30,531.0 |
Amounts owed to credit institutions | 327.2 | 327.2 | 513.1 | 513.1 |
Amounts owed to other customers | 2,719.6 | 2,723.5 | 1,171.9 | 1,171.9 |
Debt securities in issue | 3,361.9 | 3,349.8 | 2,955.0 | 2,950.6 |
Lease liabilities | 110.3 | 110.3 | 8.2 | 8.2 |
Trade payables | 14.4 | 14.4 | 3.4 | 3.4 |
Subordinated liabilities | 356.0 | 364.1 | 356.0 | 364.1 |
Subscribed capital | 15.2 | 21.1 | 15.2 | 21.1 |
37,430.9 | 37,445.4 | 35,547.1 | 35,563.4 |
£m | Group 2024 | Society 2024 | ||
Carrying Value | Fair Value | Carrying Value | Fair Value | |
Financial assets | ||||
Cash in hand and balances with the Bank of England | 1,930.6 | 1,930.6 | 1,930.6 | 1,930.6 |
Loans and advances to credit institutions | 414.6 | 414.6 | 397.8 | 397.8 |
Loans and advances to customers | 30,601.1 | 30,804.7 | 28,334.9 | 28,531.4 |
Trade receivables | 68.8 | 68.8 | 1.9 | 1.9 |
Loans to subsidiary undertakings | - | - | 403.9 | 403.9 |
Other assets | 0.1 | 0.1 | - | - |
33,015.2 | 33,218.8 | 31,069.1 | 31,265.6 | |
Financial liabilities | ||||
Shares | 28,268.5 | 28,239.2 | 28,254.1 | 28,239.2 |
Amounts owed to credit institutions | 1,599.6 | 1,599.6 | 1,800.6 | 1,800.6 |
Amounts owed to other customers | 2,751.1 | 2,753.8 | 1,268.9 | 1,268.7 |
Debt securities in issue | 2,435.3 | 2,423.1 | 1,930.1 | 1,930.9 |
Lease liabilities | 92.1 | 92.1 | 8.6 | 8.6 |
Trade payables | 11.0 | 11.0 | 2.8 | 2.8 |
Subordinated liabilities | 690.2 | 700.4 | 690.2 | 700.4 |
Subscribed capital | 41.6 | 61.8 | 41.6 | 61.8 |
35,889.4 | 35,881.0 | 33,996.9 | 34,013.0 |
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Other Information
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Performance & Strategy Governance
Financial Statements
Other Information
Skipton Group Annual Report & Accounts 2025 283
The Group’s structure and reportable segments are outlined in the Strategic Report.
Transactions between the segments are on normal commercial terms and conditions. The accounting policies
of the reportable segments are consistent with the Group’s accounting policies. The Group has not aggregated
any of its operating segments for the purposes of financial reporting. Intra-group dividends are excluded from
the segmental analysis presented as these are not included in the measure of segment profit or loss that is
used by the Group’s Board.
No geographical analysis is presented because substantially all of the Group’s activities are conducted within
the UK. Of the total external income, £81.5m (2024: £63.1m) was generated outside the UK.
A breakdown of the allocation of goodwill by segment is included within Note 25.
Group | 2025 | ||||
£m | Society | SIL | Connells | Other^ | Total |
Interest receivable and similar income | 1,956.8 | 141.7 | 16.0 | (157.6) | 1,956.9 |
Interest payable and similar charges | (1,514.6) | (99.9) | (13.0) | 185.5 | (1,442.0) |
Net interest income | 442.2 | 41.8 | 3.0 | 27.9 | 514.9 |
Net non -interest income | 46.2 | 0.3 | 1,155.1 | 11.0 | 1,212.6 |
Fair value gains / (losses) on hedged | 15.1 | (0.2) | - | (5.9) | 9.0 |
items and derivatives | |||||
Fair value losses on equity release | (14.5) | - | - | - | (14.5) |
portfolio | |||||
Fair value gains on share warrants | - | - | 5.6 | - | 5.6 |
Fair value losses on put options held by minority shareholders | - | - | (0.2) | - | (0.2) |
Fair value gains on equity share | - | - | 0.4 | - | 0.4 |
investments mandatorily held at FVTPL | |||||
Fair value gains / (losses) on other instruments mandatorily held at FVTPL | 1.1 | - | - | (3.3) | (2.2) |
Realised profits on treasury assets held | 0.3 | - | - | - | 0.3 |
at FVOCI | |||||
Profit on disposal of Group | - | - | 10.8 | - | 10.8 |
undertakings | |||||
Share of profits from joint ventures | - | - | 2.0 | - | 2.0 |
Charge on buy -back of Permanent | (27.9) | - | - | - | (27.9) |
Interest -Bearing Shares | |||||
Total income | 462.5 | 41.9 | 1,176.7 | 29.7 | 1,710.8 |
Administrative expenses | (262.4) | (29.7) | (1,102.5) | (28.8) | (1,423.4) |
Realised losses on equity release | (1.3) | - | - | - | (1.3) |
portfolio | |||||
Impairment and provisions for liabilities | (9.5) | (0.1) | (1.1) | (0.2) | (10.9) |
Profit before tax | 189.3 | 12.1 | 73.1 | 0.7 | 275.2 |
Taxation | (49.5) | (1.6) | (15.2) | 0.1 | (66.2) |
Profit after tax | 139.8 | 10.5 | 57.9 | 0.8 | 209.0 |
Total assets | 38,326.9 | 2,540.4 | 698.2 | (821.3) | 40,744.2 |
Total liabilities | 35,798.8 | 2,388.7 | 440.3 | (748.2) | 37,879.6 |
Total income can be analysed as follows:
Group | 2025 | ||||
£m | Society | SIL | Connells | Other^ | Total |
External Income | 517.9 | 13.8 | 1,157.7 | 21.4 | 1,710.8 |
Income from other segments | (55.4) | 28.1 | 19.0 | 8.3 | - |
Total Income | 462.5 | 41.9 | 1,176.7 | 29.7 | 1,710.8 |
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Other Information
Skipton Group Annual Report & Accounts 2025 284
Group (restated*) | 2024 | ||||
£m | Society | SIL | Connells | Other^ | Total |
Interest receivable and similar income | 2,083.5 | 166.4 | 17.8 | (165.4) | 2,102.3 |
Interest payable and similar charges | (1,676.3) | (114.6) | (12.3) | 189.3 | (1,613.9) |
Net interest income | 407.2 | 51.8 | 5.5 | 23.9 | 488.4 |
Net non -interest income | 43.9 | 0.3 | 1,055.4 | 13.6 | 1,113.2 |
Fair value gains / (losses) on hedged | 28.8 | (0.1) | - | (4.8) | 23.9 |
items and derivatives | |||||
Fair value losses on equity release | (12.6) | - | - | - | (12.6) |
portfolio | |||||
Fair value gains on share warrants | - | - | 5.9 | - | 5.9 |
Fair value losses on put options held by minority shareholders | - | - | (0.3) | - | (0.3) |
Fair value gains on equity share | - | - | 1.1 | - | 1.1 |
investments mandatorily held at FVTPL | |||||
Fair value (losses) / gains on other instruments mandatorily held at FVTPL | (4.0) | - | - | 4.0 | - |
Realised losses on treasury assets held | (1.8) | - | - | - | (1.8) |
at FVOCI | |||||
Share of profits from joint ventures | - | - | 1.4 | - | 1.4 |
Total income | 461.5 | 52.0 | 1,069.0 | 36.7 | 1,619.2 |
Administrative expenses | (262.0) | (21.4) | (1,008.9) | (20.0) | (1,312.3) |
Realised losses on equity release | (1.8) | - | - | - | (1.8) |
portfolio | |||||
Impairment and provisions for liabilities | 12.2 | 0.4 | 1.2 | (0.3) | 13.5 |
Profit before tax | 209.9 | 31.0 | 61.3 | 16.4 | 318.6 |
Taxation | (56.7) | (3.1) | (15.8) | (2.5) | (78.1) |
Profit after tax | 153.2 | 27.9 | 45.5 | 13.9 | 240.5 |
Total assets | 36,628.3 | 2,618.6 | 649.1 | (880.7) | 39,015.3 |
Total liabilities | 34,322.9 | 2,466.6 | 396.8 | (838.4) | 36,347.9 |
Group | 2024 | ||||
£m | Society | SIL | Connells | Other^ | Total |
External Income | 550.2 | 1.4 | 1,051.4 | 16.2 | 1,619.2 |
Income from other segments | (88.7) | 50.6 | 17.6 | 20.5 | - |
Total Income | 461.5 | 52.0 | 1,069.0 | 36.7 | 1,619.2 |
Performance & Strategy Governance
Financial Statements
Other Information
Skipton Group Annual Report & Accounts 2025 285
Performance & Strategy Governance
Financial Statements
Other Information
Skipton Group Annual Report & Accounts 2025 288
Nature of the Group’s activities
The Group holds an investment in a number of subsidiary undertakings. The Society and the majority of its
subsidiary undertakings are incorporated in the UK, with the exception of the entities listed below. For a full list
of the principal trading subsidiaries in the Group and the nature of their activities, see Note 20a) of the financial
statements.
At 31 December 2025, Jade also held a 100% ownership in the following trading subsidiary undertakings, all of
which carry out the principal business activity of the Jade group of businesses.
In addition, the Group holds a non-controlling interest of 17.7% in Wynyard Group Limited, which entered
liquidation in February 2017 and which is incorporated in New Zealand.
Country by country disclosures
An analysis of turnover, which is regarded as total income as defined below (and which excludes dividend
income from subsidiaries), profit before tax, the current tax charge, corporation taxes paid, public subsidies
received and the average number of employees on a full-time equivalent basis is set out below. The
information presented is at a full Group level of consolidation.
Total income is defined as net interest income plus fees and commissions receivable (net of fees and
commissions payable), together with all other components of operating income. Total gross income and total
gross profit before tax, for each country, represents consolidated income or profit before tax for that country.
Name of subsidiary undertaking Principal business activity
Country of
incorporation
% ownership
Interest
31.12.25
Jade Software Corporation Limited
Provider of software development services
New Zealand 100%
Skipton International Limited
Offshore deposit taker and lender
Guernsey 100%
2025
£m
UK Australia Guernsey
New
Zealand
Jersey Total
Current tax expense*
62.7
-
1.3
0.1
0.3
64.4
Corporation taxes paid
54.2
-
1.7
-
0.5
56.4
Public subsidies received^
-
-
-
-
-
-
Average number of employees
17,430
15
137
213
46
17,841
Name of subsidiary undertaking Country of incorporation
Contec Group International Limited
New Zealand
Jade Software Corporation (NZ) Limited
New Zealand
Jade Software Corporation Pty Limited
Australia
Jade Software Corporation UK Limited
UK
Northwest Investments NZ Limited
New Zealand
2025
£m
UK Australia Guernsey
New
Zealand
Jersey Total
Total income by country
1,653.6
3.7
33.5
16.2
8.3
1,715.3
Inter
-country adjustments
28.1
-
(28.1)
(4.5)
-
(4.5)
Consolidated income
1,681.7
3.7
5.4
11.7
8.3
1,710.8
Profit before tax by country
263.2
0.1
9.7
0.1
2.1
275.2
Inter
-country adjustments
35.4
1.8
(27.3)
(9.9)
-
-
Consolidated profit before tax
298.6
1.9
(17.6)
(9.8)
2.1
275.2
Performance & Strategy Governance
Financial Statements
Other Information
* The current tax expense in Guernsey and Jersey includes a Pillar Two top-up charge in SIL.
Skipton Group Annual Report & Accounts 2025 289
2024
£m
UK Australia Guernsey
New
Zealand
Jersey Total
Current tax expense**
67.1
-
2.7
-
0.4
70.2
Corporation taxes paid
64.0
-
3.6
-
0.7
68.3
Public subsidies received^
-
-
-
0.2
-
0.2
Average number of employees
16,572
14
105
225
35
16,951
2024
£m
UK Australia Guernsey
New
Zealand
Jersey Total
Total income by country
1,551.7
3.0
42.8
17.8
9.2
1,624.5
Inter
-country adjustments
54.1
-
(54.1)
(5.3)
-
(5.3)
Consolidated income
1,605.8
3.0
(11.3)
12.5
9.2
1,619.2
Profit before tax by country
285.9
0.1
27.1
1.3
4.2
318.6
Inter
-country adjustments
59.8
1.3
(53.4)
(7.7)
-
-
Consolidated profit before tax
345.7
1.4
(26.3)
(6.4)
4.2
318.6
** The current tax expense in the UK includes a Pillar Two top-up charge in the Society.
^ Public subsidies received relate to cash payments received from governments in the form of grants.
Performance & Strategy Governance
Financial Statements
Other Information
Skipton Group Annual Report & Accounts 2025 290
These percentages form part of the audited Accounts.
Explanation
The above percentages have been calculated in accordance with the provisions of the Building Societies Act
1986.
The lending limit measures the proportion of business assets not in the form of loans fully secured on
residential property. Business assets are defined as the total assets of the Group plus provisions for
impairment losses on loans and receivables, less liquid assets, intangible assets, property, plant and
equipment, right-of-use assets and investment property as shown within the Group Statement of Financial
Position.
The funding limit measures the proportion of shares and borrowings (excluding the fair value adjustment for
hedged risk) not in the form of shares held by individuals. We have taken advantage of the relief set out in SI
2007/No 860, effective from April 2007, to exclude retail offshore deposits from the total of wholesale funds.
The statutory limits are as laid down under the Building Societies Act 1986 and ensure that the principal
purpose of a building society is that of making loans which are secured on residential property and are funded
substantially by its members.
These percentages form part of the audited Accounts.
Explanation
The above percentages have been calculated from the Group and Society Income Statements and Statements
of Financial Position.
Shares, deposits and borrowings represent the total of shares, amounts owed to credit institutions, amounts
owed to other customers and debt securities in issue, including accrued interest and the fair value adjustments
for hedged risk.
Gross capital represents the general reserve together with the fair value reserve, cash flow hedging reserve,
cost of hedging reserve, translation reserve, subordinated liabilities, subscribed capital and non-controlling
interests, as shown within the Group Statement of Financial Position. Free capital represents gross capital,
less property, plant and equipment, right-of-use assets, investment property and intangible assets as shown
within the Group Statement of Financial Position.
Liquid assets represent the total of cash in hand and balances with the Bank of England, loans and advances
to credit institutions and debt securities. Mean total assets are the average of the 2025 and 2024 total assets.
Management expenses represent administrative expenses.
1. Statutory percentages
As at December 2025 (%)
Statutory Limit (%)
Lending limit
2.79
25.00
Funding limit
12.53
50.00
2. Other percentages
2025 (%) 2024 (%)
As a percentage of shares and borrowings:
(i) Gross capital
8.76
9.70
(ii) Free capital
7.24
8.31
(iii) Liquid assets
16.20
19.10
As a percentage of mean total assets:
(i) Group profit after taxation
0.52
0.63
(ii) Group management expenses
3.57
3.44
(iii) Society management expenses
0.70
0.73
As a percentage of closing total assets:
(i) Group profit after tax
0.51
0.62
Performance & Strategy Governance
Financial Statements
Other Information
Skipton Group Annual Report & Accounts 2025 291
3. Information relating to Directors at 31 December 2025
The Board of Directors at 31 December 2025, their dates of birth and dates of appointment as a Director are as
follows:
*Executive Directors
Documents may be served on any of the above-named Directors at the following address: Addleshaw Goddard,
3 Sovereign Square, Sovereign Street, Leeds, LS1 4ER.
The Directors’ business occupations and other Directorships at 31 December 2025 were as follows:
Director Date of Birth Date of Appointment
G V Burr
12 January 1963 27 April 2022
P S Chambers*
26 April 1967 26 March 2024
I A Cummings
22 October 1961 1 July 2022
S J Davis
28 June 1963 3 April 2023
H I Gunawickrema
10 April 1978 1 November 2024
S A Haire*
18 April 1974 31 December 2022
D A Hall
9 November 1955 27 March 2017
H L Jackson
23 August 1965 24 October 2018
G J Lindsay
24 August 1958 19 May 2025
Director Skipton Group Role Other Directorships held
G V Burr
Non-Executive Director
(Chair of the Board, Chair of the Board Nominations
Committee, Chair of the Non
-
Executive Remuneration
Committee)
Metro AG
Skipton Group Holdings Limited
P S Chambers
Building Society Group Chief Financial Officer
(member of the Group Executive Committee, member
of the Non-Executive Remuneration Committee)
Skipton Financial Services Limited
Skipton Group Holdings Limited
Skipton Investments Limited
Skipton Trustees Limited
I A Cummings
Non-Executive Director
(Chair of the Board Audit Committee, member of the
Board Change Committee, member of the Board
Nominations Committee, member of the Board Risk
Committee)
Designated Speak Out (Whistleblowing) Non-
Executive Director
Investec Wealth & Investment Limited
Rathbones Group PLC
Rathbone Investment Management Limited
Skipton Group Holdings Limited
TFS Derivatives Limited
Tradition Financial Services
Tradition UK Holdings Limited
Tradition London Clearing Limited
Tradition Management Services Limited
Tradition (UK) Limited
S J Davis
Non-Executive Director
(Chair of the Board Remuneration Committee,
member of the Board Nominations Committee)
Designated Colleague Non-Executive Director
Peter Vardy Global
Philip Kingsley Products Limited
Scottish Ballet
Skipton Group Holdings Limited
Trichological Clinic Limited
H I Gunawickrema
Non-Executive Director
(member of the Board Nominations Committee,
member of the Board Risk Committee)
Countess of Chester Hospital NHS
Foundation Trust
HIG Advisory Limited
Skipton Group Holdings Limited
Performance & Strategy Governance
Financial Statements
Other Information
Skipton Group Annual Report & Accounts 2025 292
3. Information relating to Directors at 31 December 2025 (continued)
Director Skipton Group Role Other Directorships held
S A Haire
Building Society Group Chief Executive
(Chair of the Group Executive Committee, member of the
Non-Executive Remuneration Committee)
Skipton Group Holdings Limited
D A Hall
Non-Executive Director
(Chair of the Board Risk Committee, member of the
Board Audit Committee, member of the Board
Nominations Committee)
Aareal Bank AG
Auxmoney Europe Holding Limited
Moneta Money Bank
Skipton Group Holdings Limited
H L Jackson
Non-Executive Director
(Chair of the Board Change Committee, member of the
Board Nominations Committee, member of the Board
Remuneration Committee, member of the Board Risk
Committee)
Admiral Long Foundation
Ikano Bank AB
Rothesay Life PLC
Rothesay Limited
Skipton Group Holdings Limited
The Veterinary Defence Society
Yorkshire Cancer Research
G J Lindsay
Non-Executive Director
(Deputy Chair of the Board, member of the Board
Nominations Committee, member of the Board Audit
Committee, member of the Board Change Committee,
member of the
Board Remuneration Committee)
Senior Independent Director
Break Charity
Family Assurance Friendly Society Limited
Family Assurance Staff Pension Scheme
Trustees Limited
Gastonrange Limited
Skipton Group Holdings Limited
The Brain Tumour Charity
Vanquis Banking Group PLC
Vanquis Bank Limited
Messrs Chambers and Haire have service contracts entered into on 6 February 2024 and 14 July 2022
respectively which may be terminated by either party giving one year’s notice.
4. Principal office
The Society is a building society incorporated and domiciled in the United Kingdom
principal office is The Bailey, Skipton, North Yorkshire, BD23 1DN
Performance & Strategy Governance
Financial Statements
Other Information
Skipton Group Annual Report & Accounts 2025 293
Set out below are the definitions of terms used within the Annual Report and Accounts to assist the reader and
to facilitate comparison with other financial institutions:
Arrears
A customer is in arrears when they are behind in fulfilling their obligations with the result
that an outstanding loan commitment is overdue.
Asset Backed Securities
(ABS)
An Asset Backed Security (ABS) is a security whose value and income payments are
derived from and collateralised (or ‘backed’) by a specified pool of underlying assets.
Typically, these assets are pools of residential or commercial mortgages.
Buy
-to-let (BTL)
mortgages
Mortgages offered to customers purchasing residential property to be rented to others to
generate a rental income.
Common Equity Tier 1
(CET1) capital
Common Equity Tier 1 (CET1) capital primarily comprises internally generated capital from
retained profits, less regulatory adjustments. CET1 capital is fully loss absorbing.
Contractual maturity
The final payment date of a loan or other financial instrument, at which point the entire
remaining outstanding principal and interest is due to be repaid.
Covered bonds
Debt securities backed by a portfolio of mortgages that are segregated from the issuer’s
other assets to be solely for the benefit of the holders of the covered bonds. The Group
has established covered bonds as part of its funding activities. Covered bonds use retail /
residential mortgages as the asset pool.
Credit Valuation
Adjustment (CVA)
The adjustment applied to the fair value of derivatives for potential mark-to-
market losses
due to credit quality deterioration of a counterparty (that does not necessarily default).
Capital Requirements
Directive V (CRD V)
Capital Requirements Directive V (CRD V) became effective on 28 December 2020 and is
made up of the Capital Requirements Directive (CRD) and the Capital Requirements
Regulation (UK CRR).
Debt securities
Assets representing certificates of indebtedness of credit institutions, public bodies or
other undertakings.
Debt securities in issue
Transferable certificates of indebtedness of the Group to the bearer of the certificates.
These are liabilities of the Group and can include certificates of deposit.
Derivative financial
instruments
A derivative financial instrument is a type of financial instrument (or an agreement
between two parties) that has a value based on the underlying asset, index or reference
rate it is linked to. The Group uses derivative financial instruments to hedge its exposures
to market risks such as interest rate risk and currency risk.
Effective Interest Rate
(EIR) method
The method used to measure the carrying value of a financial asset or liability measured at
amortised cost and to allocate associated interest income or expense over the relevant
period.
Energy Performance
Certificate (EPC)
An Energy Performance Certificate (EPC) relates to an energy rating scheme which
identifies a household’s energy efficiency level. EPC scores range from least efficient (G)
to most efficient (A) on a scale.
Expected Credit Loss
(ECL)
The present value of all cash shortfalls over the expected life of the financial instrument to
determine impairment loss allowances under IFRS 9.
Exposure at Default (EAD)
The expected outstanding balance of an asset at the time of default.
Fair value
Fair value is the amount for which an asset could be exchanged, or a liability settled,
between knowledgeable, willing parties in an arm's-length transaction.
Fair Value Through Other
Comprehensive Income
(FVOCI)
Financial instruments held at fair value in the Statement of Financial Position, with
changes in fair value recognised through other comprehensive income.
Fair Value Through Profit
or Loss
(FVTPL)
Financial instruments held at fair value in the Statement of Financial Position, with
changes in fair value recognised through the Income Statement.
Performance & Strategy Governance
Financial Statements
Other Information
Skipton Group Annual Report & Accounts 2025 294
Financial Services
Compensation
Scheme (FSCS)
The UK's compensation fund of last resort for customers of authorised financial services
firms. The FSCS may pay compensation to customers if a firm is unable, or likely to be
unable, to pay claims against it, usually because it has stopped trading or has been
declared in default. The FSCS is funded by the financial services industry.
Forbearance strategies
Strategies to assist borrowers in financial difficulty, such as arrears capitalisation, a
reduction in the monthly payment, a conversion to interest only or a mortgage term
extension. Forbearance strategies aim, if possible, to avoid foreclosure or repossession.
Free capital
The aggregate of gross capital less property, plant and equipment, right-of-use assets,
investment property and intangible assets.
Funding limit
Measures the proportion of shares and borrowings (excluding the fair value adjustment for
hedged risk) not in the form of shares held by individuals. The calculation of the funding
limit is explained in the Annual Business Statement.
Goodwill
Goodwill arises on the acquisition of subsidiary undertakings, joint ventures, associates or
other businesses and represents the excess of the fair value of consideration over the fair
value of separately identifiable net assets acquired at the date of acquisition.
Greenhouse Gases (GHG)
Gases which absorb and re-emit infrared radiation, thereby trapping it in the Earth’s
atmosphere. It includes carbon dioxide (CO₂), methane (CH
4
), nitrous oxide (N₂O),
hydrofluorocarbons (HFCs), perfluorocarbons (PFCs), sulphur hexafluoride (SF
6
) and
nitrogen trifluoride (NF
3
). These emissions add to the greenhouse effect –
a contributor to
climate change.
Gross capital
The aggregate of the general reserve, translation reserve, fair value reserve, cash flow
hedging reserve, cost of hedging reserve, subordinated liabilities, subscribed capital and
non-controlling interests.
Internal Capital Adequacy
Assessment Process
(ICAAP)
The Group’s own assessment, as part of regulatory requirements, of the levels of capital
that it needs to hold in respect of the risks it faces under a business as usual scenario and
a variety of stress scenarios.
Internal Liquidity
Adequacy Assessment
Process (ILAAP)
The Group’s own assessment that current and projected levels of liquidity are sufficient
and appropriate for the Group’s plans, under a variety of stress scenarios. It also details the
Group’s compliance with the PRA’s regulatory requirements.
Internal Ratings
-Based
approach (IRB)
An advanced approach to measuring capital requirements in respect of credit risk. The IRB
approach may only be used with permission from the PRA.
International Swaps and
Derivatives
Association (ISDA)
Master Agreement
A standardised contract developed by ISDA and used to enter into bilateral derivatives
transactions.
Investment grade
The range of credit ratings, from Aaa to Baa3, as measured by external credit rating
agencies.
Lending limit
Measures the proportion of business assets not in the form of loans fully secured on
residential property. The calculation of the lending limit is explained in the Annual Business
Statement.
Leverage ratio
The ratio of Tier 1 capital divided by total leverage exposure measure of on and off-
balance
sheet assets, after netting derivatives.
Liquid assets
The total of cash in hand and balances with the Bank of England, loans and advances to
credit institutions and debt securities.
Liquidity Coverage Ratio
(LCR)
A measure designed to ensure that financial institutions have sufficient high-
quality assets
available to meet their liquidity needs for a 30 day liquidity stress scenario.
Liquidity ratio
Liquid assets as a percentage of shares, deposits and borrowings.
Loan
-to-value ratio (LTV)
A ratio which expresses the balance of a mortgage as a percentage of the value of the
property. The Group calculates residential mortgage LTVs on an indexed basis (the value
of the property is updated on a quarterly basis to reflect changes in a house price index).
Loans past due / past due
loans
Loans on which payments are overdue including those on which partial payments are
being made.
Performance & Strategy Governance
Financial Statements
Other Information
Skipton Group Annual Report & Accounts 2025 295
Loss Given Default (LGD)
An estimate of the loss that would be incurred should a borrower default on their credit
obligations.
Management expenses
Management expenses represent administrative expenses. The cost to mean asset ratio is
management expenses expressed as a percentage of mean total assets.
Material Risk Takers
(MRTs)
A group of employees to which the FCA’s Remuneration Code applies. MRTs consist of
Executive Directors, Non-
Executive Directors and certain senior managers who could have
a material impact on the firm’s risk profile.
Mean total assets
Represents the amount produced by halving the aggregate of total assets at the beginning
and end of the financial year.
Medium Term Notes
(MTN)
Corporate notes continuously offered by an entity to investors through a dealer, across a
range of maturity periods.
Member
A person who has a share investment or a mortgage loan with the Society, or is the holder
of a Permanent Interest-Bearing Share in the Society.
Minimum Requirement for
own Funds and Eligible
Liabilities (MREL)
A regulatory requirement for the minimum amount of equity and subordinated debt a firm
must maintain to support an effective resolution.
Mortgage Backed
Securities (MBS)
Assets which are backed by underlying mortgage collateral.
Net customer
satisfaction
Net customer satisfaction score is the percentage of members surveyed that scored
satisfaction as 5, 6 or 7 minus those scoring 1, 2 or 3 (on a scale of 1-7).
Net interest income
The difference between interest received on assets and interest paid on liabilities.
Net interest margin
Net interest income as a percentage of mean total assets.
Permanent Interest
-
Bearing Shares (PIBS) or
subscribed capital
Unsecured, deferred shares that are a form of Tier 2 capital. PIBS rank behind the
claims of all subordinated debt holders, depositors, payables and investing members of the
Society.
Prime
Prime mortgages are those granted to the most credit worthy category of borrower.
Probability of Default
(PD)
An estimate of the probability that a borrower will default on their credit obligations.
Put option
Where the Group acquires a majority shareholding in a subsidiary undertaking, but grants
the non-
controlling shareholders an option to sell their shares to the Group at some future
date(s), a put option obligation exists.
Renegotiated loans
Loans are classed as renegotiated, with the customer’s consent, when their terms have
changed during the year. Loans and advances may be renegotiated whether or not the
customer is experiencing financial difficulty in repaying their loan with the Group.
Repo / reverse repo
Short to medium-
term funding agreements which allow a borrower to sell a financial asset,
such as an ABS or government bond, as security for cash. As part of the agreement the
borrower agrees to repurchase the security at some later date. For the party selling the
security (and agreeing to repurchase it in the future) it is a repo; for the party on the other
end of the transaction (buying the security and agreeing to sell in the future) it is a reverse
repurchase agreement or reverse repo, for which the underlying collateral can typically be
resold or repledged if desired.
Residential loans
Mortgage lending secured against residential property.
Residential Mortgage
Backed Securities
(RMBS)
A category of ABS that represent interests in a group of residential mortgages. Investors in
these securities have the right to cash received from future mortgage payments (interest
and / or principal).
Risk appetite
The articulation of the level of risk that the Group is willing to take in order to safeguard the
interests of the Society's members whilst achieving business objectives.
Risk Weighted Assets
(RWAs)
The value of assets, after adjustment, under CRD V rules to reflect the degree of risk they
represent.
Performance & Strategy Governance
Financial Statements
Other Information
Skipton Group Annual Report & Accounts 2025 296
Securitisation
A process by which a group of assets, usually loans, are aggregated into a pool which is
used to back the issuance of new securities. A firm transfers these assets to a special
purpose vehicle which then issues securities backed by the assets. The Group has
established securitisation structures as part of its funding activities. These securitisation
structures use retail / residential mortgages as the asset pool.
Shares
Money deposited by non-
corporate depositors in a retail savings account with the Society.
Such funds are recorded as liabilities for the Society.
Shares, deposits and
borrowings
The total of shares, amounts owed to credit institutions, amounts owed to other customers
and debt securities in issue, including accrued interest and fair value adjustments for
hedged risk.
Significant Increase in
Credit Risk (SICR)
A significant increase in credit risk on a financial asset is judged to have occurred when an
assessment using quantitative and qualitative factors identifies that the credit risk has
increased significantly since the asset was originally recognised.
Solely Payments of
Principal and Interest
(SPPI) test
An assessment of whether the contractual terms of the financial asset give rise to cash
flows that are in substance solely payments of principal and interest.
Scope 1 emissions
Under the Greenhouse Gas Protocol methodology, scope 1 emissions include emissions
generated from sources under the direct control of an organisation. For example,
emissions from combustion of fuel or oil for heating offices.
Scope 2 emissions
Under the Greenhouse Gas Protocol methodology, scope 2 emissions include those
generated from the purchase of electricity.
Scope 3 emissions
Under the Greenhouse Gas Protocol methodology, scope 3 includes all indirect emissions.
These result from the activities of the organisation, but not in their direct control. This
includes areas like leased assets, suppliers and colleague commuting.
Stage 1 financial assets
Stage 1 financial assets are those which have not experienced a significant increase in
credit risk since origination. 12-month ECLs are recognised and interest revenue is
determined by the EIR on the gross carrying amount.
Stage 2 financial assets
Stage 2 financial assets have experienced a significant increase in credit risk since initial
recognition. Lifetime ECLs are recognised and interest revenue is determined by the EIR on
the gross carrying amount.
Stage 3 financial assets
Stage 3 financial assets are identified as in default and considered credit impaired.
Lifetime ECLs are recognised and interest revenue is determined by the EIR on the net
carrying amount.
Subordinated debt /
liabilities
Unsecured debt that ranks below the claims of depositors and senior creditors in the event
of insolvency, and may be structured to meet regulatory loss-
absorbing requirements such
as MREL.
Sub
-prime
Loans to borrowers that typically have weakened credit histories that include payment
delinquencies and in some cases potentially more severe problems such as court
judgments and discharged bankruptcies.
tCO₂e
This stands for metric tonnes of carbon dioxide equivalent. It is a standard unit for
measuring greenhouse gas emissions, accounting for the different greenhouse gases using
a single factor.
Term Funding Scheme
with Additional Incentives
for SMEs (TFSME)
A scheme allowing eligible banks and building societies to access four-year funding at
rates very close to Bank Base Rate, designed to incentivise eligible participants to provide
credit to businesses and households to bridge through the period of economic disruption
caused by COVID-19 – TFSME, which closed for drawdowns in 2021, included additional
incentives to provide credit to SMEs.
Tier 1 capital
A measure of financial strength, as defined by CRD V. Tier 1 capital comprises Common
Equity Tier 1 capital and Additional Tier 1 capital.
Tier 2 capital
Tier 2 capital comprises the Society’s PIBS.
UK Capital Requirement
Regulation (UK CRR)
UK Capital Requirements Regulation (UK CRR) implemented in 2022.
Wholesale funding
Amounts owed to credit institutions, amounts owed to other customers and debt securities
in issue excluding balances deposited by offshore customers.
Performance & Strategy Governance
Financial Statements
Other Information
Skipton Building Society is a member of the Building Societies Association. Authorised by the Prudential Regulation Authority
and regulated by the Financial Conduct Authority and the Prudential Regulation Authority, under registration number 153706,
for accepting deposits, advising on and arranging mortgages and providing restricted financial advice.
Principal Office, The Bailey, Skipton, North Yorkshire, BD23 1DN.
Go to skiptongroup.com