March 2024 – Nationwide Building Society directors have announced that they plan to takeover Virgin Money. This will enlarge their empire and their already inflated pay packets. Virgin Money customers will learn all about unaccountable management and an undemocratic biased voting system at Nationwide.
Virgin Money shareholders will be consulted on the deal but building society legislation does not require the Nationwide directors to consult the members (the so-called “owners”). Nevertheless that does not stop the directors from doing so as it is members’ money but of course they wont because the society is run for the benefit of the directors and any dissent could result in a big loss in potential take-home pay. Although dissent is hardly possible with a voting system like that of North Korea.
The takeover is part of the directors’ ambitions for the society to enter fully into the banking market and in particular business banking and this message has been given much publicity by the use of the term “modern mutual” meaning bank and they now say the purpose of the society is “Banking” unlike the purpose for which building societies were invented.
The directors had made a previous attempt to catch up with the fintechs but they failed to do so. This was a very costly effort (for members) who had to pay for the hundreds of extra staff who were recruited for that purpose but the bonuses were still handed out. This exercise might be a more successful one but still costly for the members at £3.0bn. Nationwide’s performance for members remains pathetic at their claimed just “above average” (but that is only measured against high street banks) and and the highly overpaid directors are proud of this. But now a spare £3.0bn has been found to buy a bank!