Kent Reliance Building Society has shrugged off turmoil in financial markets to boost profits and assets.

The Chatham-based mutual saw assets rise by nearly 10 per cent to £2.34billion, and pre-tax profits up 121 per cent to £12.6million.

The management expense ratio, which measures the cost of running the society, fell seven per cent to 41p for every £100 of assets, the lowest in the sector.

The reduction is largely due to the society’s decision some years ago to outsource processing operations to its Easiprocess subsidiary in Bangalore, India, where it employs more than 100 people and is planning further expansion in Pune.

The business already handles work for other clients and intends stepping up this activity.

Around 50 head office staff work in Sun Pier, its present headquarters, although the society - Gililngham Football Club shirt sponsor - hopes to move to new premises in the next few months.

Mike Lazenby, chief executive, said investment in technology and India had enabled the society to process back office work faster, more efficiently and with more flexibility at less cost than was possible in the UK.

Mortgage and savings assets both rose and the society has steered clear of sub-prime loans which have caused huge losses for many financial institutions. The society blamed banks for "aggressive and high risk strategies". Some had "paid the ultimate price of failure".

Mr Lazenby complained about the high cost of contributing to the Financial Services Compensation Scheme to support other financial institutions.

"It is disappointing the building society sector is being called upon to help pay for the failure of banks that lost their way," he said.

Because of the difficult trading conditions, it had made higher provisions on certain loans but bad debt was insignificant.

The society is also reviewing its operations in the Jersey and Guernsey where it has two home loan businesses. While they were performing well, it has been unable to secure a deposit-taking licence on Jersey.

Overall, Kent Reliance was in good shape, Mr Lazenby said. "We believe we are well placed to negotiate our way through the difficulties ahead in the global financial markets and we will continue to offer a safe haven for investors."