The UK's second biggest building society blamed rising arrears among landlords who bought new build city centre flats at the height of the property boom as partly responsible for it taking a £40.4m bad debt provision.

Britannia Building Society, which saw interim profits fall from £81.7m to £50.5m in the six months to June 30 because of the impairment charge, said rising arrears had been partly fuelled by buy-to-let landlords struggling to repay loans taken out on urban apartments.