Nationwide & Portman to Merge!!!

MarkyMarkD

Milarky wrote:

Anyway, one further question. Does Nationwide include the value of the payouts (to only some 400,000 or a few percent of its customers) in the global sum of £4 Billion over ten years? If it is doing that, of course, it undermines its arguments somewhat because such largesse was highly unevenly spread.

Anyone got any analysis of how the '4bn' actually breaks down?

Nationwide have never explained their dubious £4bn figure. But I bet that it DOES include the full difference between BMR and SVR on ALL customers who have ever paid any rate linked to BMR which would otherwise have been linked to SVR.

So, as you are presumably implying, a very large proportion of the £4bn is probably in fact compensation for a mis-guided Nationwide policy from many years ago.

summersnearlyhere

Report Investor - NO I don't really want to be a carpet bagger (any bit of extra is welcome) but I have been quite proud to have been part of one of the biggest building societies still around. It has been my simple understanding that merges and take overs where societies change to banks, that members received a windfall but basically rates would then be like all other banks. Banks always appeared to pay less interest and have higher interest charges due to the fact that they had to pay shares to their members! I know that NW has grown over the years and am still waiting to see any real difference to its members. The thing that's made me cross is by reading up on this site I've discovered being a loyal member to one bank or BS is not such a good idea as they all come up with their own better offers. At the moment my 9 yr old DD has a Smart Account and I pay £10 a month in and she puts in any spare birthday and x-mas cash and has done since she was born. This account pays 5.01% AER which I thought was pretty good UNTIL I saw Halifax is offering a Children's Regular Saver account offering 10% AER for one year on savings of £10 to £100 per month! As Martin advises on this site it is good to encourage children to save and to be loyal to themselves and not to banks or BS's.

The merger with Portman should make it a giant but wasn't it a giant already and if so why can it not come up with something like the Halifax now and again? Is it because it is too busy buying up other companies and if it buys them all up will it suddenly be able to offer mega deals to customers? I don't believe it but will wait and see!

Ed - this is why I want to start and save money in other places, not that I dare to leave Nationwide (I'm loyal usually!).

ReportInvestor

MarkyMarkD wrote:

my figures (or approach at least) might stack up more if you divide by the number of relevant members, rather than the headline number of members. But I'm basing it on hearsay from a friend, not expert understanding, in this case.

I agree that we need the number of qualifying members to get a proper handle on this.

We also have to bear in mind that many Portman borrowers will also be savers = two windfalls for one member. And the news that they are paying windfalls to children will have added 10,000s if not more.

ReportInvestor

summersnearlyhere wrote:

Report Investor - NO I don't really want to be a carpet bagger [?although?] (any bit of extra is welcome)

I'm pleased to hear it .

As Martin advises on this site it is good to encourage children to save and to be loyal to themselves and not to banks or BS's.

That's the way .

The merger with Portman should make it a giant but wasn't it a giant already and if so why can it not come up with something like the Halifax now and again? Is it because it is too busy buying up other companies and if it buys them all up will it suddenly be able to offer mega deals to customers? I don't believe it but will wait and see!

The Nationwide's stated approach has been to offer good long term value. I did used to like their Member Bonds and Summer Bonds for three year members that rewarded loyalty - but these have rather diminished of late.

An example of a small mutual over-reaching itself when it tried to offer a top deal nationally has been the collapse in the Derbyshire Regular Saver rate, which has been well documented on these boards.

"Size matters" - as the bosses of the Nationwide & Portman were both telling us last week.

summersnearlyhere wrote:

this is why I want to start and save money in
other places, not that I dare to leave Nationwide (I'm loyal usually!).

Don't forget to "remain loyal" by keeping at least £100 with Nationwide, just in case so that you can vote against any possible demutualisation proposal.

ReportInvestor

BBC

Nationwide expects better deals for its members as a result of the merger

"Philip Wiliamson explained why his members would not get a windfall: "Portman is a very successful society and on day one our members will benefit from a massive profit stream of circa £100m which will come straight into the Nationwide coffers.

"We will utilise that to deliver better value to our members. It is not appropriate for us to be distributing payouts to our members.

"We believe the benefits will enable us to make mortgages cheaper, provide better savings rates, and fewer fees and charges than we do today. I couldn't use the word guarantee but we confidently expect that this will be the outcome of the deal."

wellsie82

ReportInvestor wrote:

BBC

Nationwide expects better deals for its members as a result of the merger

"Philip Wiliamson explained why his members would not get a windfall: "Portman is a very successful society and on day one our members will benefit from a massive profit stream of circa £100m which will come straight into the Nationwide coffers.

"We will utilise that to deliver better value to our members. It is not appropriate for us to be distributing payouts to our members.

"We believe the benefits will enable us to make mortgages cheaper, provide better savings rates, and fewer fees and charges than we do today. I couldn't use the word guarantee but we confidently expect that this will be the outcome of the deal."

good news that, at last something positive for us NW customers :beer:

ReportInvestor

It won't happen overnight, but stay with them and there will be improvements .

Sunday Herald

".....Analyst Mark Durling at Brewin Dolphin said: “The actual competitive environment will not see much impact in the short term. The advantages will not come through for about 18 months to two years.”

But there are serious challenges looming, which Nationwide has got to gear up for:

He added that the biggest threat to mortgage lenders such as HBOS, Abbey, Northern Rock and Bradford & Bingley is [not Nationwide, but] the arrival of foreign banks to the UK market. Netherlands-owned ING Direct is currently preparing its entry ....."

This is a rapidly changing market-place. And MSE is also part of the process that is putting pressure on many mutuals to merge.

In addition the Portman directors coming onto the Nationwide board will be able to sort out its inefficient back office :eek: - according to the Mail on Sunday

In an interview with the Financial Mail Money editor last week, the Nationwide boss elect, Graham Beale, set out his aims for the future Nationwide:

"He wants Nationwide to remain as the consumer's friend........to be known as the best, whether it's for internet banking or commercial lending."

damianiw

Can this be included in the next newsletter- I am a disgusted nationwide customer, I shall contact them expressing my dissappointment in the board and their actions and say I shall be expressing this with my feet but will also do so with the next AGM vote.

it appears completely underhand

mystic_trev

damianiw wrote:

Can this be included in the next newsletter- I am a disgusted nationwide customer, I shall contact them expressing my dissappointment in the board and their actions and say I shall be expressing this with my feet but will also do so with the next AGM vote.

it appears completely underhand

I really can't see what your complaining about! When Portman took over Lambeth BS earlier this year they got £1,000 we got nothing and our members didn't complain. Now we're getting two or three hundred quid bonus for being merged with NW you're all moaning.If you want to "vote with your feet" go on and lose your membership rights, and any windfall if they de- mutualise in the future.

thor

ReportInvestor wrote:

It won't happen overnight, but stay with them and there will be improvements .

Too long for me I'm afraid. I took most of my money out 2 or 3 years ago as their savings rate was rubbish and not rewarding their loyal members. I don't know how competitive their mortgages are but for the people who are funding them(the savers) the only way we can see the benefits of mutuality is when the NW becomes a plc. The banks are not afraid of mutuals keeping the savings rate high because they know that building societies indulge in all the same tricks i.e. not matching the boe changes, waiting for weeks before applying rate increases, knocking their rates down even when there has not been a boe reduction, etc. all this despite not having to pay any shareholders. it makes you wonder where all the money does go.