Invasion of the carpetbaggers

Building societies are raising the minimum required to open new accounts to deter non-locals after cash incentives. By Clifford German

Speculators are still stuffing cash into new accounts with building societies at a rate of pounds 50m a day as the scramble to open accounts and qualify for a cash bonuses or a share handouts continues.

Last week, Northern Rock announced plans to become a bank and turn its members into shareholders. This week, Bristol & West has agreed to surrender its independence and mutual status to the Bank of Ireland. Speculators who have opened accounts since the start of this year will only get a modest pounds 250 of preference shares as a reward for their persistence, but this is still better than the proverbial poke in the eye.

Meanwhile, the public is playing hunt-the-treasure with an enthusiasm only exceeded by lottery addicts. Several billion pounds have been invested in new accounts with building societies this year in anticipation of a quick reward for approving a takeover or a conversion. Money was initially rushed into the top 10 societies, which were most likely to convert into a bank and issue shares to members if they approved the conversion. But as the bigger societies have announced plans to convert or be taken over, the speculators have started investing in the smaller societies that have moved up the list into the top 10 to replace Alliance & Leicester, Northern Rock and Bristol & West.

A significant amount of the cash from maturing Tessas has been invested, and attempts by some societies to deter "carpetbaggers" by raising the minimum investment needed to qualify for voting membership of the society and the right to share in the sweeteners has only increased the rush.

Even those societies that have committed themselves most outspokenly to remaining mutual, such as Nationwide, Bradford & Bingley, Britannia, Portman, Yorkshire and Coventry, say they have had an upsurge in new accounts. In general, however, it has not been enough to cause great problems in the branches or to overwhelm the societies with money they cannot hope to on-lend in the current depressed state of demand for mortgages. But investors encouraged by media speculation have been turning their attention to Birmingham & Midshires, creating queues that have disrupted normal service, particularly in several big city branches where fat cats scent a quick profit. On Monday, the board responded by raising the minimum investment needed to open a new membership account from pounds 100 to pounds 500 in its smaller branches and to pounds 1,500 in 17 big city branches, mainly in Birmingham, Manchester and London.

Leeds & Holbeck and Chelsea moved yesterday to raise still further the minimum investment needed to open an account and qualify for instant membership. Some societies have renewed their commitment to remaining mutual, serving their local communities by discriminating against investors from outside their home territory. Derbyshire has just raised the opening balance required for new membership accounts to pounds 1,000 for investors living outside its Midland core area. It followed the example of Cheshire, which raised the threshold for new investor/ members living outside its core Granada TV area to pounds 2,500, although locals can still qualify with pounds 100.

Our table shows the top 12 surviving building societies committed to remaining mutual, and the minimum amounts required to open a new account that qualifies for membership. They will convey instant membership, although most of them are notice accounts, and the rate of interest they pay, if anyone still cares about that, will vary significantly.

The top 12 list looks quite different to what it was a year or two ago, when it was dominated by Halifax, Nationwide, Woolwich, Leeds Permanent, Cheltenham & Gloucester, Alliance & Leicester, Bradford & Bingley, National & Provincial, Britannia, Northern Rock and Bristol & West.

All but three of that top 12 have announced their intention to convert into a bank or be taken over by another financial institution. Nationwide, Bradford & Bingley, Britannia, Yorkshire and Birmingham & Midshires are the five biggest surviving societies still apparently committed to mutuality.

THE TOP DOZEN BUILDING SOCIETIES

What it costs to join the remaining mutuals

Rank Society Minimum Deposit pounds

1 Nationwide 500

2 Bradford & Bingley 500

3 Britannia 500

4 Yorkshire 100

5 Birmingham Midshires 500/1500*

6 Portman 100

7 Coventry 500

8 Skipton 2500

9 Leeds & Holbeck 500*

10 Chelsea 1000*

11 Derbyshire 100

12 Cheshire 100/2500*

Arts and Entertainment
Characters in the new series are based on real people, say its creators, unlike Arya and Clegane the Dog in ‘Game of Thrones’
tv'The Last Kingdom' embraces politics, religion, warfare, courage, love and loyalty, say creators
Sport
Sergio Romero saves Wesley Sneijder's penalty
world cup 2014But after defeating the Dutch, Lionel Messi and Argentina will walk out at the Maracana on Sunday as underdogs against Germany
Sport
Scoreboard at the end of the semi-final World Cup match between Brazil and Germany at The Mineirao Stadium in Belo Horizonte
Sport
'Saddest man in Brazil' takes defeat with good grace, handing replica trophy to German fans
PROMOTED VIDEO
News
peopleThe Game of Thrones author said speculation about his health and death was 'offensive'
Arts and Entertainment
Martin Freeman and Lauren O'Neil in Jamie Lloyd's Richard III
theatreReview: The monarch's malign magnetism and diabolic effrontery aren’t felt
News
Glamour magazine hosts a yoga class with Yogalosophy author Mandy Ingber on June 10, 2013 in New York City.
newsFather Padraig O'Baoill said the exercise was 'unsavoury' in a weekly parish newsletter
Extras
indybest
News
people'She is unstoppable', says Jean Paul Gaultier at Paris show
Sport
Alexis Sanchez and apparently his barber Carlos Moles in Barcelona today
football
Arts and Entertainment
Miley Cyrus has her magic LSD brain stolen in this crazy video produced with The Flaming Lips
video
Arts and Entertainment
In his own words: Oscar Wilde in 1882
theatreNew play by the Oscar Wilde's grandson reveals what the Irish wit said at his trials - and what they reveal about the man
News
people
Arts and Entertainment
Unless films such as Guardians of the Galaxy, pictured, can buck the trend, this summer could be the first in 13 years that not a single Hollywood blockbuster takes $300m
filmWith US films earning record-breaking amounts at the Chinese box office, Hollywood is more than happy to take its lead from its new-found Asian audience
News
The garage was up for sale in Canning Place Mews for £500,000
newsGarage for sale for £500,000
Life and Style
tech
Finacial products from our partners
Property search
Have you tried new the Independent Digital Edition apps?
Independent Dating
and  

By clicking 'Search' you
are agreeing to our
Terms of Use.

ES Rentals

    iJobs Job Widget
    iJobs Money & Business

    Associate CXL Consultant

    £40000 - £60000 per annum + BONUS + BENEFITS: Harrington Starr: CXL, Triple Po...

    Associate CXL Consultant

    £40000 - £60000 per annum + BONUS + BENEFITS: Harrington Starr: CXL, Triple Po...

    Financial Planning Manager, Qual Accountant, £380

    £300 - £380 per day: Orgtel: Financial Planning Manager, Banking , London, £30...

    Business Analyst - Financial Services, Trading Systems, Agile

    £60000 - £75000 per annum + BONUS + BENEFITS: Harrington Starr: A leading fina...

    Day In a Page

    The true Gaza back-story that the Israelis aren’t telling this week

    The true Gaza back-story that the Israelis aren’t telling this week

    A future Palestine state will have no borders and be an enclave within Israel, surrounded on all sides by Israeli-held territory, says Robert Fisk
    A History of the First World War in 100 Moments: The German people demand an end to the fighting

    A History of the First World War in 100 Moments

    The German people demand an end to the fighting
    New play by Oscar Wilde's grandson reveals what the Irish wit said at his trials

    New play reveals what Oscar Wilde said at trials

    For a century, what Wilde actually said at his trials was a mystery. But the recent discovery of shorthand notes changed that. Now his grandson Merlin Holland has turned them into a play
    Can scientists save the world's sea life from

    Can scientists save our sea life?

    By the end of the century, the only living things left in our oceans could be plankton and jellyfish. Alex Renton meets the scientists who are trying to turn the tide
    Hollywood targets Asian audiences as US films enjoy record-breaking run at Chinese box office

    Hollywood targets Asian audiences

    The world's second biggest movie market is fast becoming the Hollywood studios' most crucial
    Grindr founder Joel Simkhai: 'I've found love on my dating app - and my mum keeps trying to hook me up!'

    Grindr founder Joel Simkhai: 'I've found love on my dating app'

    Five years on from its launch and Grindr is the world's most popular dating app for gay men. Its founder Joel Simkhai answers his critics, describes his isolation as a child
    Autocorrect has its uses but it can go rogue with embarrassing results - so is it time to ditch it?

    Is it time to ditch autocorrect?

    Matthew J X Malady persuaded friends to message manually instead, but failed to factor in fat fingers and drunk texting
    Westminster’s dark secret: Adultery, homosexuality, sadomasochism and abuse of children were all seemingly lumped together

    Westminster’s dark secret

    Adultery, homosexuality, sadomasochism and abuse of children were all seemingly lumped together
    A History of the First World War in 100 Moments: Dulce et decorum est - a life cut short for a poet whose work achieved immortality

    A History of the First World War in 100 Moments

    Dulce et decorum est: a life cut short for a poet whose work achieved immortality
    Google tells popular music website to censor album cover art in 'sexually explicit content' ban

    Naked censorship?

    The strange case of Google, the music website and the nudity take-down requests
    Howzat! 8 best cricket bats

    Howzat! 8 best cricket bats

    As England take on India at Trent Bridge, here is our pick of the high-performing bats to help you up your run-count this summer 
    Brazil vs Germany World Cup 2014 comment: David Luiz falls from leader figure to symbol of national humiliation

    David Luiz falls from leader figure to symbol of national humiliation

    Captain appears to give up as shocking 7-1 World Cup semi-final defeat threatens ramifications in Brazil