NATIONWIDE has emphasised the need for lenders to balance credit supply with affordability as it warned of potential economic slowdown in the UK, writes Scott Wright.

The warning came as the mutual, which took over the Dunfermline Building Society in 2009, reported an 18 per cent fall in profits and net mortgage lending in the period from April 5 to June 30.

Nationwide, which has 47 branches in Scotland, reported underlying profits of £301m for the period, compared with £368m in the first quarter of 2016. However the building society said profits were broadly consistent with the prior period after allowing for a £26m gain this quarter and a £100m one-off gain in quarter one last year. Nationwide received £26m from the sale of its investment in VocaLink, the payments company, while it booked £100m in June 2016 from the sale of its stake in Visa Europe.

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Net lending dropped to £2.4bn over the period, compared with £3.5n last time, which Nationwide said was down largely a reduction in buy to let advances.

While the mutual’s research signalled consumers do not expect access to credit to change because of Brexit, chief executive Joe Garner said it was important lenders “balance carefully credit supply with affordability” with consumers less optimistic about the economic outlook.