Britannia and Co-op may merge in April

cvd

While appreciating that a Co-op/Britannia merger is different to a Nationwide/Cheshire merger, there is no doubt that Britannia would be seeking to remain independent if it didn't have a combination of funding issues (wholesale markets seizing up) and difficulties with its acquired and own mortgage books.

I agree. The worry for Britania members (and Coop members) is that the new
chief executive will be the current chief executive of the Britannia. He is not very good.

mike_the_bike_2

The "mutual thing" is a total myth

The directors of mutuals just run things and do whatever they want withot having to bother about needing share holder votes and without having to publish the detailed financial information that a PLC is required to do.

Primrose

I wonder how many members of Mutual Building Societies read the Annual Report and Accounts and actually vote For or Against when it comes to voting on the recommendations of the Remuneration Committee

Stuart_W

Well, for a total myth, The Co-Operative Group are doing pretty well. There is this merger with Britannia, they've successfully bought Somerfield (and expect to get the keys next month) and they remain Britain's biggest farmer.

I don't think the Co-operative Group's three million plus members see mutuality as a myth. Plenty of them may not be happy with certain decisions, and they speak up at members' meetings (carbon offsetting for flights I remember sparked several debates in many regions). Not everyone will get what they want but mutuality does mean you have the right to a say.
Questionnaires are often used to gauge opinion from a wider cross section of members than those that attend meetings - such as the food survey which got over 100,000 replies leading to the ethical food policy, or the 2008 finance survey to update the bank's ethical policy on it's 15th anniversary last year.

Since the Co-op bank hasn't needed a penny of bail-out money, I'm not going to start critisizing it now.

And let's be honest, the idea of being "accountable" to share holders hasn't really worked for the big banks, now, has it....

y0z2a

Thank you Stuart.

A really good set of answers - you clearly know what you are talking about.

/y0z2a

opinions4u

Stuart_W wrote: »

Well, for a total myth, The Co-Operative Group are doing pretty well.

Parts of them are. Parts of them have contracted quite significantly over the last two decades.

There is this merger with Britannia, they've successfully bought Somerfield (and expect to get the keys next month) and they remain Britain's biggest farmer.

Not bad at funerals either.

I don't think the Co-operative Group's three million plus members see mutuality as a myth. Plenty of them may not be happy with certain decisions, and they speak up at members' meetings (carbon offsetting for flights I remember sparked several debates in many regions). Not everyone will get what they want but mutuality does mean you have the right to a say.

As does being a shareholder in a company. Or writing to the letters pages of the local newspaper.

Questionnaires are often used to gauge opinion from a wider cross section of members than those that attend meetings - such as the food survey which got over 100,000 replies leading to the ethical food policy, or the 2008 finance survey to update the bank's ethical policy on it's 15th anniversary last year.

Which is nice. Also, did they farm the trees that provided the paper?

Since the Co-op bank hasn't needed a penny of bail-out money, I'm not going to start critisizing it now.

They do indeed seem to have run a steady course through turbulent times.

And let's be honest, the idea of being "accountable" to share holders hasn't really worked for the big banks, now, has it....

You do wonder why the City institutions didn't reign the banks' lending in long before now. I'm gobsmacked that the organisation that taught me the advatnages of how to lend sensibly should end up a subsidiary of Lloyds.

I agree with much of what you say. But I don't buy the thought that mutuality is better (or worse) than being a plc. They are merely different forms of ownership where the directors (or equivalent) still run the business to their own agendas.

julliff

I agree with much of what you say. But I don't buy the thought that mutuality is better (or worse) than being a plc. They are merely different forms of ownership where the directors (or equivalent) still run the business to their own agendas.

I also agree.

I worked for Nationwide for 6 years, and the current CEO is an Accountant. He was always banging on about profits. He said that profits were inportant so that NW could offer its members better deals. But surely the deals would be better if NW weren't making so much profit in the first place? Or am I being stupid?

Never really got that one, but you can be sure that the Directors bonuses were linked to profit!

Cozworth806

Nationwide should be thankful that their unexceptional rates are dwarfed by the carp that Britannia offer.

The worry for Co-op members is that the CEO runs it in the same way as Britannia are now. Profits should be minimal to be keep the capital ratio and reserves in line.

Milarky

Cozworth806 wrote: »

Nationwide should be thankful that their unexceptional rates are dwarfed by the carp that Britannia offer.

What carp offer? I'm lucky enough to be getting 7.5% for a third year running - but only at the expense of other Britannia customers/ I suppose therefore I can feel a little bit better knowing that Co-op's deep pockets will soon be cross subsidising that product instead. (or will they just keep drop the carp rates instead when they get to 'see the books'?)

apt

I agree. The Britannia Direct Saver Reserve at 3.5% including 6 month bonus is also better than any comparable Nationwide offering. Apart from a Flexaccount for foreign currency spending none of the Nationwide's variable products are any good. NW may be making noises about protecting savers but the horse has already bolted. To be credible they should have thought about this earlier and done something like YBS. Instead they've cut some savings accounts by more than the fall of the base rate.