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Britannia Building Society news

It was announced on Wednesday 21 January, that Britannia Building Society, provider of the PMAS Mortgage Service, will be merging with the Co-operative Financial Services.  

The following information is provided by Britannia and the Co-Operative Financial Services for our Mortgage Service customers.

Why is this merger being proposed?

The combined and complementary strengths of our businesses, with their shared commitment to customer democracy, would offer customers a real fair and ethical, customer-owned alternative to plcs. This new business will combine The Co-operative Financial Services' strong personal and corporate banking, insurance and investment expertise with Britannia's extensive high street presence and savings and mortgage know-how.

The merger between The Co-operative Financial Services, part of the world's biggest consumer co-operative, and Britannia, the UK's second biggest building society, will create a business capable of competing on equal terms with the banks, with £70 billion of assets, nine million customers, over 12,000 employees, more than 300 branches, 20 corporate banking centres and British-based call centres.

Is this a merger or a takeover of Britannia by The Co-Operative Financial Services?

This is a merger by choice. Both businesses have been pursuing successful strategies and don't need to merge, but we recognise we could be even more successful by coming together to create the UK's most trusted financial services business. The merger will be delivered by the transfer of Britannia's business to The Co-operative Financial Services. Britannia's members will become members of the enlarged The Co-operative Group.

Is my money safe?

The Financial Services Authority has confirmed that under the current arrangements savers who have accounts with both organisations will retain their £50,000 protection with each business under the Financial Services Compensation Scheme.

What would the combined business be called?

The legal entity would be The Co-operative Financial Services, but the new business would continue to trade under both the Britannia and The Co-operative Financial Services brands for the foreseeable future, although we would look to move quickly to offer a single product range once complex systems integration is complete.

Whatis the difference between a mutual and a co-operative?

A mutual is any organisation owned by its customers or members. Customers of a mutual such as a building society are members by virtue of the product they hold, while members of a co-operative join, usually by paying a nominal sum of £1. The rules governing different types of mutual are largely historic (although the Butterfill seeks to bring them up to date) but the key values, beliefs and commitment to member ownership are the same for both businesses.

What will this mean for our respective membership rewards schemes?

Members of both businesses will continue to earn rewards as they do now, pending integration. Members of the merged business will have more opportunity to increase what they earn and to earn on a wider range of products, including The Co-operative shops, travel agents, etc.

Am I likely to get a windfall payment?

No. The combined business will be a mutual society founded on strong ethics and values. This will mean that our members continue to own the business and have rights to share its value and participate in its decision-making - they won't be giving anything up. The value our members own in Britannia is carried forward into the new business so there is no "windfall" payment.

What wukk happen to my mortgage and my monthly repayments?

Nothing immediately. Some Britannia and The Co-operative Financial Services accounts that offer the same features will have their rates equalised, to the better of the two, very soon after legal completion. We remain committed to meeting the needs of our members and customers and will continue to offer a competitive range of products and services. We will take a phased approach to any integration in order to ensure that we maintain our usual high levels of customer service.

What will happen to my loans?

You will see no change to any loan you have with Britannia or The Co-operative Financial Services. You will be able to deal with us in the same way you always have done.

Will I get different rates on my savings and mortgage?

The vast majority of Britannia and The Co-operative Financial Services customers will see no immediate change to the products and services they receive. We'll keep you informed about any changes we may make to your account in the future.

WIll I still be able to visit my local Britannia or The Co-operative Financial Services branch?

Yes. We remain committed to providing a competitive range of products and services through an extensive branch network and other channels. Combining the two branch networks will increase the number of branches available for customers to more than 300. Where there are two branches in the same town, these may be merged in due course.

Is there a number I can call for more information?

Will there be any impact on service?

The merged business will operate over 300 branches, 20 corporate banking centres and British-based call centres, as part of a multi-channel service. Once the process of integration is completed, customers will have access to high-quality products across the range of financial services. In the short-term however, the Britannia and The Co-operative Financial Services brands will continue to offer their own products via their existing channels.

If you have any further questions please contact us.