Someday soon (Nationwide Building Society)

Name: dave27

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Product:	Nationwide Building Society
Date:	20/11/01 (3119 review reads)
Rating:

Advantages: Reasonable terms

Disadvantages: They're still just fater yer cash

Carpetbagger(n)
An astute investor, often of modest means, who spots brilliant investment opportunities.
In recent years, the best opportunities have come from mutual building societies and insurers; opening membership accounts for as little as £100 to qualify for windfalls from the inevitable process of conversion and takeover.

(With the greatest thanks to the Carpetbagger site - http://www.mywebcommunities.com/carpetbagger/ )

Carpetbagging was a big thing a while back, the practice of spying out a likely mutual building society which was likely to convert at the drop of a hat, thus making any members liable to reap a huge windfall following the conversion. Thousands were made by a few lucky people and just as the bandwagon really got rolling the attention of the peddlers in greed turned upon the Nationwide Building Society, which looked like the next candidate for the gravy train.

Thousands of small investors clambered aboard, keen to join the jet set and prepared for the tills to start chinking ... except they never did, to this very day, despite all sorts of attempts to force the issue with some members even going so far as getting elected to the board and trying to force votes on the issue.

Even as recently as June 2001, the same Carpetbagger site boasted the following article from The Telegraph: "More than 6m members of Nationwide Building Society will be sent voting packs this week giving them the opportunity to elect two rebel candidates to the board. One of the rebel members, Andrew Muir, is against the Nationwide's pledge to remain a building society and wants it to become a bank. If Mr Muir is elected to the Nationwide board he is expected to press for a conversion vote. Members last voted on whether or not the society should keep its mutual status or convert and pay out windfalls in 1998, when 1.1m wanted Nationwide to convert into a bank, but 1.13m voted for the society to stay mutual. However, nea
rly 3m people did not vote at all. The second candidate, Alan Debenham, a semi-retired maths teacher from Taunton, Somerset, who thinks the society is not mutual enough, last week stepped up his campaign to secure a place on the board. Mr Debenham sent out leaflets protesting that the Nationwide vote, which is due to be held on July 19, is not democratic because the building society has rejected a member resolution to permit members to vote on increases in directors' pay. This is the fourth year that Mr Debenham has tried to get himself elected on to the Nationwide board. Mr Debenham said that members should vote for him on the grounds that as a board member he will encourage "openness, honesty, accountability, democracy and genuine mutuality". The 60-year-old is one of six standing for election to four available posts. Those standing for re-election are Charles Nunneley, chairman, Bernard Simpson, deputy chief executive, and non-executives Paul Twyman and Richard Handover. If either Mr Debenham or Mr Muir succeed, they will not be the first ordinary members to win a seat on the board."

The attempt was unsuccessful and the Nationwide has steadfastly resisted all attempts to force its sell out and the Nationwide's own website (http://www.nationwide.co.uk ) still proudly boasts that "Nationwide has mutual (as opposed to Public Limited Company) status, which means that it is owned by its members".

It's become a chest beating anthem over the last few years, almost a mantra that Nationwide will continue to be owned by its members, and one of the Society's main goals is to preserve the status quo.

I can't say that I think there's that much to choose between banks and building societies these days, so to my eyes this has always seemed a pretty irrelevant issue, but for some reason the Building Society machismo has become something to cherish and die for if needs be. But then the Nationwide has be
en in this game a long time and its website emphasises the long tradition: "The industry has since witnessed hundreds of mergers between smaller societies to form first regional, then national societies. Nationwide's dual origins lie in Northampton (1848) and within the co-operative movement in London (1883) respectively."

There have been many mergers involving Nationwide over the years, with the most recent and significant being that between the Nationwide and Anglia Building Societies 14 years ago. For a while it was known as the Nationwide and Anglia, but the junior partner's name soon got dropped out of the title, at first informally and then latterly officially. The move was clearly aimed at preserving the mutual status as demonstrated my another quote from the Society's site: "Nationwide is the UK's fourth largest mortgage lender and ninth largest retail banking, saving and lending organisation by asset size. More significantly, Nationwide is the largest building society in the world and is committed to staying mutual."

Okay, enough of the liberal quotes, I guess you get the general idea.

My Mum always had a savings account with the Nationwide the whole of her life and I've had one for the last three or four years. The Nationwide has always had the homespun image, smacking of insurance collectors who pedal the streets every weekend hawking their wares, bike clips around the ankles of their baggy pants. This image is less relevant these days as Nationwide has joined the Internet banking revolution and sought to compete with its more commercial competitors on a level playing field.

I think at present that they're falling a little between the two stools, desperately seeking to retain the family image and association, but earnestly trying to prove that they can mix it with the big boys. They just about manage to pull it off, but in terms of both service and products I'm not con
vinced that there's much to choose between any providers of financial services.

Nationwide claim that all day to day services on their current accounts are totally free and that overdrafts are easy to arrange, with no fees involved. You can get 24 hour access to your account via cash machine, the Internet or telephone and the Society boasts 26,000 ATM machines in the UK.

Now that's all as may be, but like I've already said, there's little to choose between any of these large organisations these days, be they owned by the members or not, and your quality of service will largely depend on the staff in your branch and their attitude. If they're good, you'll get a decent service - if they're bad, they're horrid.

A month or so ago, The Independent carried the following story: "Nationwide Building Society was caught last week trying high-pressure selling on a customer phoning in the middle of the night to cancel his cash card after a robbery. The Independent on Sunday reader's home had been burgled. He discovered the break-in at 3am and found that, among other things, the thieves had taken his wallet with his cards. He called police, then started cancelling the cards. Alliance & Leicester, Bank of Scotland, HSBC, Barclaycard and American Express dealt with this and made no fuss. But when he called Nationwide, the "customer service agent" astonished him by saying: "I know it's a strange time to ask, but would you be interested in a personal loan." When the reader said this might not be top of his priorities at that moment, the Nationwide salesman persisted with: "Well, we do have very low rates of interest." Some banks use the calls made to cancel credit or debit cards after a robbery as an opportunity to sell card-protection or insurance services. But most appear to believe this is a time when it is best to keep their sales patter strictly to themselves. When Nationwide
was contacted about this enquiry, they first tried to justify the action. "No other product should be mentioned until the query is dealt with. But then the opportunity could be used to bring to the member's attention products of which they are not aware," The Independent on Sunday was told. Nationwide also tried to defend selling products in the middle of the night. "We are a 24-hour bank. Lots of our customers are shift workers." Ultimately, Nationwide did offer an apology. "This is not something our advisers are expected to do. They are expected to show discretion. This was an inappropriate time. The member phoned in need and, in the circumstances, it was not appropriate to do anything else." "


Hmmm... not too helpful, you may say ... of course, such practices are pretty standard these days, industry wide and all the promise of being member owned did nothing for anyone in this case. In the end like most everything you need to decide for yourselves based on personal experience. I've always found my Nationwide account to be perfectly satisfactory, but then I've never used it very heavily and it's always been just a back up savings account for me.

Still, if they ever do succeed in getting Nationwide to go public, I stand a good chance of copping for a good pay off, so who really cares?

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