Nationwide offers existing clients £300 to switch deals

28 June 2010 | By Natalie Thomas

Nationwide Building Society is offering its existing customers £300 cashback to switch to other deals at the end of their mortgage.

But the society says the move is not designed to lure clients away from its 2.5% base mortgage rate, as has been claimed by some brokers.

The offer came into effect on June 11 as part of the society’s simplification of its core range.

A spokeswoman for Nationwide says: “We have offered similar loyalty schemes for existing customers in the past and this deal is just an extension of that.

“It’s nothing to do with moving customers away from our BMR, it’s about rewarding loyal clients.”

In May Nationwide reported underlying annual profits before tax of £212m, down on last year’s £393m.

The society blamed low interest rates for a fall in profits for the year to April.

The society claims that its promise to not increase its BMR to more than 2% above the Bank of England base rate has cost it more than £450m over the year.

The society’s share of the mortgage market fell slightly to 8.7% from 9% in 2009.

Group residential net lending was £3.6m - up from £1.6m in 2009. Meanwhile, the lender’s gross prime lending for the year is estimated to be £10.3bn, down from the £16.7bn seen in 2009.

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