Become a Nationwide member without "windfall" signaway

bristolleedsfan

gordylad wrote: »

Does anyone know what mutual have no sign away to charities? For example I've been looking at the ybs site and so far can see nothing relating to sign away.

Thanks

kent reliance building society doesnt have a signaway http://www.krbs.co.uk/

my opinion is ignore the signaways as none yet have been enforced, just try and put your 100.00 in best paying accounts, so u in a no lose situation even if it means doing reg savers with 100.00 initial investment followed by 10.00 a month and then make a withdrawal once per year to bring balance back down to 100.00.

please note im not a "carpetbagger" i merely enjoy forum topics regarding mutuality, mergers and/or merger/conversion payouts :rotfl:

MarkyMarkD

wombat42 wrote: »

Quote:
Originally Posted by MarkyMarkD
I'm just going to be happy with the £600 I'll clear from the Portman/NW merger (£200 each for me and Mrs MMD as a merger bonus plus £100 each from the accounts we hold with Portman which we'll no longer require), less £40 of tax on mine .

So you think it is futile just keeping £100 in for a future Nationwide demutualisation windfall ?

Obviously not, as that would contradict everything I've said on this thread. I and Mrs MMD have been Nationwide non-signaway members since 1997, so the Portman merger doesn't do anything for us in terms of Nationwide membership.

MarkyMarkD

cheggers wrote: »

If you ask me Nationwide got Portman on the cheap, £160 a member on average.

I'm not sure about your £160 statistic. The fact that tax was deductible from the payout doesn't save Nationwide any money. Many members got more than the basic £200.

Anyway, it's not as simple as that.

Nationwide got Portman, but also got a lot of new members. Its members got the benefit of Portman but it was diluted for each existing Nationwide member because of the increased number of new members.

It's sort of meant to work out fair. Using completely made-up numbers which illustrate how it can be fair although it doesn't seem fair:

If Portman was worth £1.2bn and Nationwide £5bn, and they had 1 million and 5 million members before merger, each Portman member's membership was worth £1,200 before the merger and each Nationwide member's membership was worth £1,000 before the merger.

Each Portman member gets £200 (say) plus Nationwide membership.

Ignoring membership overlap, the resulting society is worth £1.2bn + £5bn - £200m = £6bn. This is shared between the 6 million new members who each have a membership worth £1,000.

So, Portman members start with a membership worth £1,200, and end up with £200 cash (albeit taxable) and membership worth £1,000.

Nationwide members start and end with a membership worth £1,000.

So, it's fair.


But it doesn't seem fair for lots of reasons, primarily the fact that (until the signaway was introduced) anyone could walk into Nationwide off the street and get £1,000 worth of membership (based on the made up figures above) for nothing.

That's the fundamental flaw of mutuality - it only makes sense, and it is only fair, if the organisation stays mutual forever.

In fact even then it's not fair, because mutuals don't trade at a break-even, meaning that they are constantly taking money from present members and giving it to future members - or not, if there's a signaway, whereby they are taking money from present new members and giving it to charity.

baby_boomer

MarkyMarkD wrote: »

I'm not sure about your £160 statistic. The fact that tax was deductible from the payout doesn't save Nationwide any money. Many members got more than the basic £200.

I think the average was more like £450 gross ( £360 net).

bristolleedsfan wrote: »

my stated belief was that your daughters trustee nationwide account appears to have no useful purpose for windfall reasons.

I gather that :rotfl:.

But you're not prepared to say that it is definitely harmless?

andyrules

MarkyMarkD wrote: »

Ignoring membership overlap, the resulting society is worth £1.2bn + £5bn - £200m = £6bn. This is shared between the 6 million new members who each have a membership worth £1,000.

So, Portman members start with a membership worth £1,200, and end up with £200 cash (albeit taxable) and membership worth £1,000.

Nationwide members start and end with a membership worth £1,000.

Marky, I'm a long-standing member of Nationwide, what do you mean membership is worth £1000? Are members due for a windfall from the merger?

Milarky

andyrules wrote: »

Marky, I'm a long-standing member of Nationwide, what do you mean membership is worth £1000? Are members due for a windfall from the merger?

No, he's just saying 'what if' things to illustrate how the Portman probably brought about as much [per member] in assets 'goodwill' etc to the 'marriage' as Nationwide did. That neither makes NW more nor less likely to change its mind about issuing shares in the future. You just have to sit things out like the rest of us (er!) members...

Of course it's not as simple as that and anyone can use 'hypotheticals' to make any case he/she wishes.

For instance, suppose 50 percent of Portman members were already members of NW before the merger was announced. These people have 'lost' because - for £200 - they have lost the right to a second windfall - were Portman to float (or sell themselves to a bank as did C&G) instead of merge. Such windfalls can now only come from Nationwide - but then these people would already have qualified for those. The other 50 percent obviously gained at their expense - because they got £200 PLUS the chance of a windfall from Nationwide.

...we could go on endlessly.

wombat42_2

andyrules wrote: »

Marky, I'm a long-standing member of Nationwide, what do you mean membership is worth £1000? Are members due for a windfall from the merger?

No you get zilch from the merger. I think he was giving hypothetical windfall figures if and when Nationwide demutualised.

bristolleedsfan

baby_boomer wrote: »

I gather that :rotfl:.

But you're not prepared to say that it is definitely harmless?

in what is a hypothetical thread nobody can say that something is definitely going to be the case, you will be wanting me to decide what u have for tea next baby_boomer. :rotfl: :rotfl:

cheggers

Any news if Cheshire are to merge with anyone, I could do with a windfall from them next:rotfl: :rotfl:

MarkyMarkD

Thanks to Milarky and co. for explaining what I meant so eloquently.

I would slightly disagree with the assertion that membership isn't "worth" £1,000 though - it's worth something even if the eventual payout is many years away and is uncertain.

But then you'd have to discount any future value by the time value of money and multiply it by the probability of it arising...