Darlington Building Society said yesterday that it had pushed up mortgage lending by seven per cent last year in the face of tough market conditions.

The mutual said it had seen strong growth in 2005, with new lending also increasing by 10.2 per cent to £103m during the year, despite flat demand for housing finance and intensifying competition.

It also increased lending to society members more than seven per cent, and group commercial assets grew to over £423m. Members' savings grew by four per cent to £452m and, at the year end, total group assets stood at £548m.

The mutual, which is celebrating its 150th anniversary, said it helped 121 worthy causes over the year.

Chief executive Peter Rowley said: "I am delighted that the support of our members has produced a very solid performance during our 150th year.

"We commenced trading in July 1856 in the Central Hall, Darlington, as the Darlington Working Men's Equitable Permanent Building Society.

"We have a proud heritage that few businesses can match and already 2006 has commenced strongly. Not only can members and staff take pride in our illustrious past, but we can also look forward to a bright future."

Marketing and communications manager David Copland said: "It has been a slower year in terms of housing transactions, but we have been able to keep growing by keeping our products at competitive prices, which allow us to compete against the likes of massive lenders such as Northern Rock and Halifax.

"Because we are a mutual rather than a plc, our focus is not on maximising profits each year, but reinvesting in the business and keeping our rates competitive. We don't have dividends to pay to shareholders, which really allows us to do that."