N&P finance director heads list of 36 job losses at Peterborough HQ
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Norwich and Peterborough Building Society’s finance director Richard Wells is to leave the mutual as part of a raft of job cuts at its head office in Peterborough.
Some 36 staff are to be made redundant, with the finance director the most senior role affected.
N&P says the job cuts follow a review over the summer of the society’s cost base and are part of an effort to reduce overheads.
A spokeswoman for N&P says the move is necessary due to the lack of funding that is blighting the financial services sector.
She says: “The higher cost of retail funding, the reduction in funding from wholesale sources, lower yields from liquid assets and low LIBOR and base rate are all contributing to these exceptional times.”
She maintains that the society is financially sound and has no history of toxic lending.
But she adds: “The price of funding following the collapse of the money markets shows no sign of easing and taking costs out of the business has become unavoidable.”
Jeff Pritchard, currently risk director at N&P, will assume Wells’ responsibilities and become finance and risk director.
N&P was downgraded by Fitch Ratings last week prior to Mortgage Strategy Online revealing the proposed job cuts.
Fitch says it took the action as it believes earnings at the society will be hampered by high costs.
But at the same time Fitch awarded N&P a ‘stable outlook’ status. It says liquidity at the society is good and notes that it is still able to raise substantial deposits.
Kevin Friend, strategic partnerships director at Mortgages.co.uk, says: “Funding is an issue for all mutuals. A number have ventured out of their comfort zones and tried to compete in unconventional markets in recent years.
“It is inevitable that the societies that have done this and not exercised adequate controls will be affected. I think there are more downgrades to come.”
But Friend adds that some societies have remained prudent, pointing to Market Harborough which is growing without diversifying from its core range.
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