Mortgage News - August 2007

Nationwide confirms Merge

Nationwide has confirmed its merger with fellow mutual Portman. The society now has assets in excess of £160bn, with around 13 million members. The merger also brings together the two specialist lending brands - UCB Home Loans and The Mortgage Works - which are being retained in a dual strategy.Graham Beale, chief executive of Nationwide, says: "Today marks the start of an exciting new chapter in Nationwide's history. The completion of our merger with Portman is a major step forward for us and will underpin our future success.

UK bank and building society mergers do not benefit their customers, new data from the ESRC Centre for Compeition Policy suggests. An analysis of UK bank and building society mergers has found that although these mergers have generated substantial efficiencies for the banks concerned these benefits have not been passed on to customers.The study by the ESRC Centre for Competition Policy at the University of East Anglia found that while most merging institutions have benefited from mergers, interest rates for the bulk of banking customers remain unchanged.Indeed, savers who hold notice saving accounts with merging banks and building societies have suffered a decline in interest rates up to six years after a merger takes place.

Lloyds TSB will reveal today it is to close down 31 Cheltenham & Gloucester stores nationwide. Erlier in the month it was revealed the bank was set to shut its wholly-owned C&G stores and move intermediary support to a central location. At the time, C&G categorically denied this. Now Steve Tatlow, assistant general secretary at Lloyds TSB Group Union, has confirmed this is the case. Tatlow says: “We expect the bank to eventually mirror the approach Barclays took when it announced the closure of its Woolwich branch network, when all Woolwich branches within 300 metres of Barclays branches were closed.”