NEWCASTLE Building Society (NBS) is expanding its operations in the North-East and creating 500 jobs over the next five years.

The financial institution has acquired premises at Cobalt Business Park, North Tyneside, in additional to its main office in Newcastle.

Most of the jobs will be created within the society's strategic solutions business, which generates income by providing technology, processing capability and administrative support to third-party clients, such as banks and other building societies.

NBS, which counts a number of major financial sector businesses including Bradford and Bingley and Bank of Ireland as customers, secured a £1.3m grant through regional development agency One NorthEast.

The money will allow NBS to expand its strategic solutions business services to a wider market and invest further in new technology.

Colin Seccombe, NBS chief executive, said: "We have recently enjoyed significant growth across the whole business, reflected in our extremely positive half-year financial results. In particular our strategic solutions operation is continuing to grow rapidly."

Newcastle Strategic Solutions Limited manages savings, loans, mortgages and pre-paid cards on behalf of third-party customers. The bulk of jobs created will be in its fully managed services offering, which includes customer acquisition, application processing, account management, administration services and a telephone-based contact centre.

NBS is working with the developers of Cobalt Business Park, at Highbridge, to design a high-spec office space that will house the latest equipment and improved training and recreation facilities.

The company, which was founded in 1861, employs more than 1,000 staff across its 37 branches and main offices.

One NorthEast chairman Margaret Fay said: "NBS is a well respected indigenous business that has bucked the trend to off-shore any of its activity. Rather than look to cut costs by outsourcing work they have chosen a more positive and proactive response in broadening capacity to maximise development opportunities in the UK and Europe.

"This project will create a state-of-the-art document processing facility with an associated contact centre on North Tyneside that will generate 500 jobs for the North East. It is fantastic for the region and I would commend NBS for its continued commitment to the North-East."