Now it's emerald windfalls

After the spate of UK building society conversions, Ireland could be the next target for committed carpetbaggers. Steve Lodge reports

Bumper windfalls worth up to pounds 2,000 go out this week to 900,000 customers of Northern Rock building society. This is the last of this year's rash of handouts by building societies, but it is not the end of the windfall story.

For one, the payouts continue into October, with insurer Scottish Amicable set to send windfall cheques averaging pounds 550 to more than a million policyholders as part of its takeover by Prudential. Australian Mutual Provident (AMP), which owns Pearl and London Life in the UK, will soon send out forms for voting on its planned conversion - some 200,000 policyholders in the UK can look forward to receivingan average of pounds 1,500 each next summer.

Elsewhere First National, the biggest remaining building society in Eire, has just said it plans to convert into a bank, a move set to yield windfalls for 220,000 savers and borrowers, mostly in Eire but with thousands in the UK. The announcement could prompt a flurry of speculative account openings by British and Irish residents with remaining building societies in Eire.

The estimated 10,000 savers with First National accounts actively marketed in the UK will not qualify for the windfall because those accounts do not carry membership rights. The same applies to thousands of borrowers with The Mortgage Corporation and Mortgage Trust, both owned by First National. But on top of 7,000 savers and borrowers in Northern Ireland who have been with the society two years or more, there are an estimated 30,000 to 35,000 savers resident in the UK - mostly Irish living here - who have accounts in Eire and will qualify. Qualifying savers and borrowers can look forward to free shares worth Ipounds 1,500 (pounds 1,400) on average. The shares should be doled out by spring 1999, and will be traded on both the UK and Irish stock markets.

The ideal way of "carpetbagging" an Irish building society would be to open an account in person, but there is nothing to stop windfall-seekers opening accounts by post. In practice it is almost certainly too late to benefit from the First National handout. In Eire, to qualify for a conversion windfall you must have had a building society account for two years before the day a vote date is announced. In the case of First National the actual date of the vote has not been announced, but it should be announced within a year. You would also need Ipounds 5,000 (around pounds 4,500) to open an account. Existing First National savers should ensure they maintain a balance of at least Ipounds 100 for now.

But it may be worth opening accounts with the few other remaining societies. First National's conversion move follows that of the Irish Permanent in 1994, from which some UK savers benefited. And, says Des Byrne, director general of the Irish Mortgage and Savings Association, the Irish trade body representing banks and societies: "In Ireland we're more laid back [about mutual status]."

Mr Byrne says that apart from First National there are only really three societies left: EBS (formerly the Educational), the Irish Nationwide and the Norwich Irish. EBS is said to be the most insistent that it will not convert. It says it has no minimum opening balance (although windfall hunters should look to invest at least pounds 100). Norwich Irish - strongly linked to Norwich Union, the UK insurer which recently converted - cites a minimum opening balance of Ipounds 100, but to open an account with Irish Nationwide you will need Ipounds 5,000. Each society will send application forms to open accounts to the UK and will accept sterling cheques by post to open accounts. The societies will convert sterling cheques into savings deposits in Irish punts.

Carpetbaggers should move quickly, however. Both First National and Irish Nationwide have already used the excuse of their being plagued by speculative account openings to justify raising opening balances, and the others may follow. Savers should also remember they need to be a member for at least two years to qualify for any windfall.

Northern Rock is expected to prove the UK jackpot; qualifying savers and borrowers each get a fixed 500 shares (although borrowers who are also savers get two sets). Estimates of up to pounds 4 a share have been put on the price when the shares open on Wednesday. People who have already opted to have their shares sold straight away by the society will have the proceeds automatically paid into a nominated Northern Rock account on 9 October, or be sent a cheque on 8 October.

q First National building society, 00353 1 283 1801; EBS, 00353 1 677 5599; Irish Nationwide, 00353 1 609 6000; Norwich Irish, 00353 1 671 7220.

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