Become a Nationwide member without "windfall" signaway

MarkyMarkD

bristolleedsfan wrote: »

without both a vote for conversion and the required number of votes in favour of conversion ( and nationwide arent planning to give one anytime soon if ever, ) the value of the signaways to the charitable foundation is precicely NOTHING, nobody on ANY forum actually agrees with you.

Your point (if I can call it that, because it isn't really one) is that IF there was a prospect of a demutualisation, the Foundation would miraculously waive its rights to £1bn+ in return for a promise of a few £m a year.

I'm not saying that demutualisation is likely, soon or ever. But if demutualisation WAS on the cards, the situation for the Foundation is not as you have painted - the signaways clearly then have enormous value.

you are the same person ( and again the only person) that has stated that their has never been a significance in the " 2 year rule" when as a matter of fact only those who had been members of cheltenham and gloucester for 2 years + got a payout and in the case of bristol and west takeover by bank of ireland 2 year + members got minimum of 500.00+ whereas "under" 2 year members got preference shares worth around 250.00.

All I've said about 2 year rules is that there is no 2 year rule for absolute entitlement. In every case apart from C&G, members immediately before announcement of demutualisation have got some sort of windfall. Whether that's in cash, shares, or preference shares is academic to most people - it's still a windfall.

The C&G demutualisation was a strange exception. The "two year rule" is enshrined in the Building Societies Act, but it was stupidly worded legislation which Abbey got a court ruling to ignore. Heaven knows why C&G took any notice of it.

love2learn

What does this mean, why can't someone explain what all this means in English? If I can make money by opening a Portman account, I will do. Can someone tell me how to do this?

wombat42_2

love2learn wrote: »

What does this mean, why can't someone explain what all this means in English? If I can make money by opening a Portman account, I will do. Can someone tell me how to do this?

You are too late to get a windfall for the imminent Portman/Nationwide merger.

But if you open a Portman account before 25th Aug (and keep at least £100 in it at all times), you will be eligible for a windfall for any future Nationwide demutualisation.

bristolleedsfan

wombat42 wrote: »

But if you open a Portman account before 25th Aug (and keep at least £100 in it at all times), you will be eligible for a windfall for any future Nationwide demutualisation.

after 5 years portman membership as things currently stand.

bristolleedsfan

MarkyMarkD wrote: »

The C&G demutualisation was a strange exception. The "two year rule" is enshrined in the Building Societies Act, but it was stupidly worded legislation which Abbey got a court ruling to ignore. Heaven knows why C&G took any notice of it.

there was no "strange exception" re "C+G demutulisation", the "two year rule," "applied" to CASH payouts, C+G was taken over by lloyds bank it WASNT a "demutalisation".

C+G paid out CASH as lloyds bank did not want to give out free shares in lloyds bank, hence the "two year rule" being applied.

abbey WAS a "demutualisation", shares were given not cash so the " 2 year rule" did not apply.

MarkyMarkD

The two year rule indeed rules out cash distributions, but that isn't a reason why C&G had to apply the two year rule. They could have distributed something near-cash like preference shares as has occurred in other cases. That's why I think that was a strange decision.

You are splitting hairs by saying that the acquisition of C&G by Lloyds was not a demutualisation - it was the acquisition of the assets of a mutual by a bank. Indeed, Cheltenham & Gloucester plc exists and became a subsidiary of Lloyds. Presumably, though, Lloyds created C&G plc to buy C&GBS's assets? I honestly don't know. (And I'm not sure how much I care).

bristolleedsfan

MarkyMarkD wrote: »

The two year rule indeed rules out cash distributions, but that isn't a reason why C&G had to apply the two year rule. They could have distributed something near-cash like preference shares as has occurred in other cases. That's why I think that was a strange decision.

You are splitting hairs by saying that the acquisition of C&G by Lloyds was not a demutualisation - it was the acquisition of the assets of a mutual by a bank. Indeed, Cheltenham & Gloucester plc exists and became a subsidiary of Lloyds. Presumably, though, Lloyds created C&G plc to buy C&GBS's assets? I honestly don't know. (And I'm not sure how much I care).

perhaps if u contact lloydsTSB and let them know that uve made over 5000 posts on moneysavingexpert.com a special meeting will be organised so that lloydsTSB can detail to u on what basis whatever decisions were made when they "bought" cheltenham and gloucester BS. :rolleyes:

cheltenham, and gloucester plc is merely a division of lloydstsb ( part of lloydstsb) in the same way as birmingham midshires which was also "bought", is a division of halifax plc ( part of halifax plc) which is part of the HBOS group.

alliance and leicester,northern rock, bradford and bingley whom all "demutalised", as things are at present have not been bought so are not "trading names" or "divisions" of anything or anybody. :cool:

IvanOpinion

I am not convinced that sign-away's are "cast iron". Things change, people create new accounts, move money to different accounts etc. and I would be inclined to suggest that if the Nationwide does not regularly poll it's customers to ensure that the 'sign away' is still what they want after X years then it would be hard to enforce it.

Now if they canvassed their members I am sure a lot would say that they did not want the "sign-away" ... but that would mean them closing down the accounts which is obviously not in the interests of the Nationwide.

I think that ultimately any attempt to enforce a "sign-away" after more than a year or so would need to be challenged in the courts.

ivan

MarkyMarkD

Interesting argument, Ivan, but I don't agree in the slightest. A contractual agreement is a contractual agreement. There's no requirement for each party to canvass the other party's ongoing commitment to its terms - they continue until the agreed contract period ends - or, in this case, doesn't as it's indefinite.

I'd be interested to see any individual taking Nationwide BS to court in the event of a demutualisation, because they didn't accept the signaway. But I don't think it likely that anyone would be inclined to start such a court action.

bristolleedsfan

IvanOpinion wrote: »

I think that ultimately any attempt to enforce a "sign-away" after more than a year or so would need to be challenged in the courts.

ivan

totally agree with you bar the above point, nationwide didnt devise the signaway with the intention that they would demutalise with some members entitlements going to the charitable foundation, nore are the charitable foundation under any illusions about that.

nationwide devised the signaway to ensure that it would neither be forced to demutalise by its members nore face a hostile bid ( reason northern rock committed itself to giving its charitable foundation a fixed amount of its annual profits was to make itself less attractive to a hostile bid), nationwide have neither any intention of enforcing the signaway nore quashing it. ( if anyone believes differently then they should ask nationwide.)

the O/P started the thread speculating on what might happen in the future, ( bit like daily express speculating on future house price movements and mail paper speculating "again" on which building societies might be taken over in the future)

if nationwide were asked, nationwide would say that its an irrelevant conversation because nothing is going to be changing.

should nationwide decide in the future to demutalise then its apparent it would look freshly at the signaways as it wouldnt win a demutalistaion vote with the signaways in place.

if the signaways were ever enforced ( lets face it 99.5% of building societies have the signaways with 95% of them having absolutely no likelyhood of demutalising ) then "signed out" nationwide members would claim that they were mislead into signing themselves out of any future demutalisation because nationwide have stated that they have no intention of demutalising and that the signaways were only introduced to minimise "speculators disrupting its business".

to the person who NEVER agrees with what anybody says, here is the fact as stated by nationwide BS as to why the signaway was introduced by nationwide BS. ( im sure nationwide are certain as to the reason they introduced the signaway :rolleyes: )

"Important note
[FONT=Verdana,Verdana]On 3 November 1997 we introduced a new condition as part of the declaration for all customers opening a FlexAccount or membership savings account or applying for a mortgage. We have had to introduce this new condition to avoid disruption to our business caused by speculative activity and to enable us to run our business as normal."[/FONT]