Skipton profit dragged down by £141.5m

Two of Britain's biggest building societies today reported sharp falls in their profits as their bad debts soared and they picked up their part of the tab for the failure of Bradford & Bingley.

Skipton, which has more than 6000 members, saw its profits crash from £164 million to £22.5 million but still claimed its results stood out against the performance of banks and its mutual peers.

It lost £11 million on deposits with collapsed Icelandic banks and made a further £20.8 million of provisions against unnamed liabilities, up from just £800,000.

Writedowns in the society's savings and mortgages business soared from £5.4 million to £34.6 million. Borrowers three months or more in arrears soared from 0.41% to 1.14%. A sharp fall in profits at its estate-agents chain Connells saw pre-tax earnings fall from £59.7 million to £10.4 million.

Principality, the Welsh building society, saw its profits drop from £20.5 million to £5.7 million.