Nationwide to merge with smaller rivals

Nationwide has confirmed that it has agreed to merge with two of its smaller rivals, the Derbyshire and the Cheshire.

The smaller mutuals will transfer into the Nationwide Group under two separate transactions.

The Derbyshire and the Cheshire have a combined total of 925,000 members, and will add to the nation’s largest building society to form assets totalling more than £191bn and £122bn of retail deposits.

Graham Beale, chief executive at Nationwide, says: “The Derbyshire and the Cheshire have independently concluded that a merger with Nationwide is in the best interests of their savers and borrowers given the financial issues faced by both societies.

“The core member businesses of both societies are in good shape and have a better future as part of a larger organisation.

“Nationwide is in a unique position because of its size and financial strength to provide support, and we regard it as both responsible and commercially beneficial to undertake these mergers.”

Graham Picken, chief executive of the Derbyshire, says: “I am pleased that the Derbyshire has come to an agreement with Nationwide that assures the future for our savers and borrowers.

“The board recognised a number of financial uncertainties facing the Derbyshire, and has taken this prudent and pre-emptive action in seeking a solution to secure the interests of our members over the long-term. I have every confidence that the Derbyshire members will benefit from being part of the enlarged society.”

Karen McCormick, chief executive of the Cheshire, said: “We are pleased with the progress we have made at the the Cheshire in building a progressive modern mutual organisation for our members. The core member business is strong.

But she adds: “Whilst we have performed resiliently, the unprecedented market conditions and poor economic outlook have led the board to consider its strategic options.

“I am confident that our members will benefit from the strength of the combined organisation. It is pleasing that the Cheshire brand and branch network, together with its presence in the North West, are being retained through a merger which we believe will be in the best interests of our members.”