Is Carpetbagging Dead

castle96

one day... one day !

worldtraveller

IanManc said:

worldtraveller said:

couriervanman said:

Britannia......was part of co-op bank
Chelsea.....now part of Yorkshire B/S
Norwich & Pet....now part of Yorkshire B/S
Stroud & Swindon.....now part of Coventry B/S

There were no windfall payments on these mergers

Sure, but a merger isn't a demutualisation.

I'm still a 'member' of Nationwide (via an account held from the 1960's in Anglia Buliding Society) and of Britannia (from an account opened back in the 1980's).

I can't see any further demutualisation at any time soon because demutualisation was an undoubted failure, as the shareholder owned mortgage banks that resulted, I believe, all failed.

You can't still be a "member" of Britannia as it now just a trading name of the Co-op Bank, and that bank is wholly owned by US hedge funds.

OK, sure, semantics rule! You're correct! On the merger with Co-operative Financial Services, members of the former Britannia Building Society became members of the Co-operative Group.

1882

Nationwide were a good advert for the mutual sector but nowadays many banks treat customers better!

DiggerUK

gandb said:

I've £100 sat in several Mutual Building Societies.   Have the rules changed?   The derisory % is irrelevant.  Is Carpet-bagging Dead?
My list includes:  Any suggestions please?

Britannia

Chelsea

Coventry

Nationwide

Newbury

Newcastle

Norwich & Pet

Stroud & Swindon

West Bromwich

It seems there won't be a lot worth taking from your cold, dead hand, when the time comes. You don't even have enough to buy a shiny, gleaming one ounce gold Britannia.

Carpet bagging???... didn't that go out with flares..._

Thrugelmir

How many of the building societies that demutualised survived as independent banks? 

castle96

Nationwide... one day! ONE DAY ! FK the directors

ZeroSum

Thrugelmir said:

How many of the building societies that demutualised survived as independent banks? 

Off the top of my head, probably just Halifax

bowlhead99

ZeroSum said:

Thrugelmir said:

How many of the building societies that demutualised survived as independent banks? 

Off the top of my head, probably just Halifax

And that one didn't exactly 'survive' independently ; too-big-to-fail, Lloyds were pressured to take it under their wing to stop it going pop (paying way more to HBOS shareholders than they really deserved; HBOS P&L in 2008 was negative £10-11 billion) and then Lloyds in turn got £20bn of government assistance, but kept going.

So the Halifax brand still exists, but not because it was still a resilient and well capitalised lender a decade after demutualisation. It was quite the opposite!

Newnoel

roddydogs said:

Nationwide put it to a vote, but the majority voted to stay a mutual so now youve got all the disadvantages of a bank, without the payout!

The only ones getting a payout from the Nationwide were, and still are, the directors.
From the 2019 remunerartion report, the top directors earned between £1.3m and £2.4m each:
Report of the directors on remuneration 2019 | Nationwide
It is yet another so-called mutual run for the benefit of its directors, rather than the account holders

bowlhead99

Newnoel said:

roddydogs said:

Nationwide put it to a vote, but the majority voted to stay a mutual so now youve got all the disadvantages of a bank, without the payout!

The only ones getting a payout from the Nationwide were, and still are, the directors.
From the 2019 remunerartion report, the top directors earned between £1.3m and £2.4m each:
Report of the directors on remuneration 2019 | Nationwide
It is yet another so-called mutual run for the benefit of its directors, rather than the account holders

Nationwide have a little over £200bn of mortgages and loans to customers and £160bn of member deposits.  So if the top executive director had worked for free and not taken his salary, benefits and bonus, we could have each had an extra £0.0000066 of savings interest or saved borrowing interest for every pound we saved or borrowed.

For those saving £10k or borrowing £10k for a car, less than seven pence of difference to the interest. More of a difference to mortgage borrowers, who would have had 66p less mortgage interest to pay on every £100k borrowed. 

When you add all those 7p and 66p amounts, it's not chump change, so a lot is made of chief exec pay and what the 'fair market rate' should be for someone being recruited into a top job on a plc bank or building society board. In practice, if you gave the top job to someone on a minimum wage apprenticeship, the financial institution's balance sheet might get worse rather than better. The customers might not like knowing that they are paying 6p to the CEO out of the interest rate on their £10k borrowing or savings, so will no doubt go to a different financial institution if they don't like the rates on offer. 

But in reality, most customers will make their 'stay or go' decision on what the rates are and what the customer service is like, rather than what the big boss gets paid - and so the rates and customer service levels are driven by the competitive environment, meaning that those rates and service levels wouldn't be expected to change significantly if the boss got paid a bit less less.  

If the boss on a £2.4 million package (including a £1m performance-related bonus) voluntarily gave up a third of that bonus, and they shared that saved money between all the savers and borrowers, the share for a £10k borrower or saver would not be as much as a penny. Maybe it would be good marketing for them to say the boss took a pay cut to help out the borrowers and savers - but people who want to moan about executive pay would still say he's getting too much (because it's more than they earn in their own jobs which they believe to be just as difficult; and the people with £10k of savings or car loans or credit card balances would moan that although his pay was ostensibly cut to give them a 'better deal', actually their share was under 1p each so their monthly statement was entirely unchanged and it didn't make a blind bit of difference to their lives.