A new bid to sell benefits of mutuality

National & Provincial, Britain's ninth-largest building society, is in an unenviable position. Its financial performance over the past few years has been markedly worse than its competitors', culminating in this week's announcement of a drop in operating profits and a collapse in net lending during 1994 from £394m to just £8m.

Last year, an attempt to forge a merger with Leeds Permanent, creating what would have been the third-biggest society, failed, resulting in the departure of chief executive David O' Brien.

Had Mr O Brien's strategem succeeded, the combined society would most likely have gone down the flotation route. Now that N&P is having to fend for itself, new chief executive Alastair Lyons favours a return to true principles of mutuality.

This has resulted in a marketing drive called Mutual Interests which will "give practical effect to the concept of mutuality", according to Mr Lyons. From 6 April all voting members of the society will be eligible for benefits that include discounted personal loans, free or discounted insurance cover, share-dealing incentives and extra interest on some savings accounts.

It would be easy to be cynical about Mutual Interests. After all, members will have to buy a new product before they can share in the enhanced concept of mutuality. The programme is designed to allow N&P to make better use of its customer base through cross-selling.

But that would be to deny that the society is giving something back to its 1.7 million qualifying members other than just the right to vote at annual meetings and the prospect of a windfall should the society be taken over.

City analysts point out that N&P has made a clear distinction between its commercial and mutual aims. It already has competitive mortgage and savings products in place. In any case, its options were limited if it wanted to give something back to members.

N&P could have distributed profits. But that would have amounted to only £15 per member, the society estimates, and would have further weakened the organisation. Instead it has chosen to offer a string of incentives to take its products.

Benefits to choose from include free mortgage valuations, 100 per cent loans for first-time buyers, free emergency home cover for a year, discounts on personal loans and extra-interest savings accounts. This could save people as much as £236 on the society's normal charges this year.

Of course, this will not stop customers shopping around for the best deal. But any initiative that forces keener pricing in the industry has to be good for the consumer.

To benefit from Mutal Interests you must be hold a qualifying share account or hold a mortgage with N&P. Under building society legislation, only first-named mortgage and savings customers with at least £100 in their account at 31 December 1994 will qualify.

But N&P said that legislation preventing second-named account holders from benefiting from members' rights is unfair. Other named account holders will also be allowed to benefit from the preferential terms with the member's consent.

N&P said it wanted to see the current review of building society legislation result in societies having greater flexibility to agree themselves who could be members, rather than having this determined by statute. This would make it possible to include, as members, customers who are currently excluded - such as those with personal loans, credit cards, PEPs and pensions.

"We see the modern role of a building society as being to meet the broad range of personal financial service requirements of our customers as members," said N&P chairman Lord Shuttleworth.

BEST DEPOSIT RATES

INSTANT ACCESS Telephone Account Notice Deposit Rate Interest

or term % interval

Skipton BS 01756 700511 3 High Street Instant £2,000 6.25 Year

Manchester BS 0161 834 9465 Easy Saver Instant £50 6.75 Year

Britannia BS 01538 392808 Capital Trust Postal £10,000 6.50 Year

£25,000 6.75 Year

NOTICE ACCOUNTS

Nottingham BS 0602 481444 Autumn Bonus 30 Day £2,500 5.90 Year

Coventry BS 0345 665522 Postal 50 50 Day (P) £2,000 6.55 Year

Scarborough 0723 368155 Scarborough 50 50 Day (P) £25,000 7.35 Year

Bristol & West (Asset) BS 0800 303330 Asset 90 90 Day (P) £25,000 7.10 Year

TERM ACCOUNTS

Woolwich BS 0800 400900 One yr fxd rate bond 1 year £500 7.50 fixed Year

Halifax BS 01422 333333 Guaranteed Reserve 1 year £10,000 7.50 fixed Year

2 year £10,000 8.25 fixed Year

3 year £10,000 8.60 fixed Year

MONTHLY INTEREST

Birmingham Midshires BS 0902 710710 First Class Postal £1,000 4.79 Month

Britannia BS 01538 392808 Capital Trust Postal £2,000 5.84 Month

£10,000 6.31 Month

£25,000 6.55 Month

TESSAS (tax-exempt special savings accounts)

Manchester BS 0161 832 0101 5 Year £8,400 8.00 fixed Year

Market Harborough BS 0858 463244 5 Year £9,000 7.75 Year

Hinckley & Rugby BS 01455 251234 5 Year £3,000 7.65 Year

Barclays Bank 0800 400100 5 Year £1,000 7.50 Year

HIGH-INTEREST CHEQUE ACCOUNTS

Woolwich BS 0800 400900 Current Instant £500 3.85 Year

Halifax BS 01422 333333 Asset Reserve Instant £5,000 5.00 Year

Chelsea BS 0800 717515 Classic Postal Instant £2,500 6.00 Year

£25,000 6.50 Year

OFFSHORE (gross)

Portman Channel Islands 01481 822747 Instant Gold Instant £5,000 6.20 Year

Derbyshire IOM 01624 663432 Instant Access Instant £10,000 6.30 Year

Derbyshire IOM 01624 663432 90 Day 90 Day £10,000 6.75 Year

Halifax JSY 01534 59840 Fixed Rate Intl 1 Year £50,000 7.70 fixed Year

NATIONAL SAVINGS

Accounts & bonds (gross) Notice or term Deposit Rate % Interest interval

INVESTMENT ACCOUNTS 1 Month £20 5.25 Year

£500 5.75 Year

£25,000 6.00 Year

INCOME BONDS 3 Month £2,000 6.50 Month

£25,000 6.75 Month

CAPITAL BONDS (Series I) 5 Year £100 7.75 fixed Maturity

FIRST OPTION BONDS 12 Month £1,000 6.40 fixed Year

£20,000 6.80 fixed Year

PENSIONER'S GUARANTEED INCOME BOND (Series 2)

5 Year £500 7.50% fixed Month

NS Certificates (tax free)

42nd ISSUE 5 Year £100 5.85 fixed Maturity

8th INDEX-LINKED 5 Year £100 3.00+RPI Maturity

CHILDRENS BOND (Issue G) 5 Year £25 7.85 fixed Maturity

P= by post only. All rates are shown gross and are subject to change without notice.

Source: Chase de Vere Investments PLC - 0171 404 5766. Compiled on 16 February 1995

BEST BORROWING RATES

MORTGAGES

Fixed rates Telephone Rate/period Max Fee Incentive

% advance % £

Hinkley & Rugby BS 01455 251234 1.50 to 1/1/96 70 £250 -

Capital Home Loans 01252 812271 2.99 for 1 year 95 £295 -

Citibank 0181 846 8363 6.45 to 1/3/97 85 £250 -

Leeds & Holbeck BS 01532 459511 7.99 to 1/4/98 75 £145 -

Northern Rock BS 0800 591500 8.74 to 15/4/00 90 £250 No MIG, free valuation

TSB Local branch 9.49 to 31/3/05 95 £250 Free valuation

Variable rates

Scarborough BS 0800 590547 1.95 for 12 months 95 - Free valuation

Bristol & West BS 0800 100117 2.49 for 1 year 90 - -

Bank of Ireland 01734 510100 5.55 to 1/4/97 90 £260 2yrs free ASU - FTB

Stroud & Swindon BS 01225 427764 6.50 to 31/1/98 75 - -

PERSONAL LOANS

Unsecured Telephone APR Fixed monthly payments on £3,000 for 3 years

% With insurance Without insurance

Midland Bank Local branch 15.40 £116.54 £103.14

Abbey National Local branch 15.90 £115.81 £103.77

Clydesdale Bank 0141 248 7070 16.30 £113.94 £103.33

Secured Max advance % Max term

Royal Bank of Scotland 0131 556 8555 10.90 70 3 years to retirement

Midland Bank Local branch 11.40 90 5 to 30 years

First Direct 0800 222000 12.30 80 Up to 40 years

TYPICAL OVERDRAFTS

Telephone Authorised Unauthorised

EAR % EAR %

Barclays Bank Local Branch 19.20 29.80

Lloyds Bank Local Branch 19.40 26.80

National Westminster Bank Local Branch 18. 90 33.25

BEST OVERDRAFTS

Telephone Authorised Unauthorised

EAR % EAR %

Woolwich 0800 400900 9.50 29.50

Alliance & Leicester BS 0500 959595 9.50 29.80

Abbey National 0800 555100 9.90 29.50

CREDIT CARDS

Telephone Card name Minimum Rate APR Annual

income pm % % fee

Standard

Robert Fleming (S&P) 0800 282101 Mastercard/Visa - 1.00 14.60 £12

Royal Bank of Scotland 0131 556 8555 Mastercard - 1.25 16.00 -

TSB Local branch Mastercard/Visa - 1.38 17.90 -

Gold cards

Lloyds Bank Local branch Mastercard £20,000 0.94 11.80 £40

Midland Bank Local branch Mastercard £20,000 1.30 18.10 £35

MBNA International 0800 062620 Mastercard/Visa £20,000 1.38 18.90 -

STORE CARDS

Payment by direct debit Other methods

Telephone pm APR pm APR

John Lewis Local store - - 1.39 18.00

Marks and Spencer 01244 681681 1.70 22.40 1.84 24.40

Burtons Local store 1.94 25.90 2.20 30.40

APR=Annualised percentage rate. EAR=effective annual rate. All rates are subject to change without notice.

Source: London & Country. Freephone 0800 373300 Compiled on 16 February 1995

Start your day with The Independent, sign up for daily news emails
ebooks
ebooksAn introduction to the ground rules of British democracy
Latest stories from i100
Have you tried new the Independent Digital Edition apps?
SPONSORED FEATURES
Independent Dating
and  

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

iJobs Job Widget
iJobs Money & Business

Recruitment Genius: DBA Developer - SQL Server

£30000 - £35000 per annum: Recruitment Genius: This is an exciting opportunity...

Recruitment Genius: Customer Service Administrator

£13000 - £15000 per annum: Recruitment Genius: Are you passionate about custom...

Recruitment Genius: Dialler Administrator

£22000 - £25000 per annum: Recruitment Genius: Main purpose: Under the directi...

Ashdown Group: Contracts Manager - City of London

£35000 - £37000 per annum + benefits : Ashdown Group: Contracts Manager - City...

Day In a Page

Blairites be warned, this could be the moment Labour turns into Syriza

Andrew Grice: Inside Westminster

Blairites be warned, this could be the moment Labour turns into Syriza
HMS Victory: The mystery of Britain's worst naval disaster is finally solved - 271 years later

The mystery of Britain's worst naval disaster is finally solved - 271 years later

Exclusive: David Keys reveals the research that finally explains why HMS Victory went down with the loss of 1,100 lives
Survivors of the Nagasaki atomic bomb attack: Japan must not abandon its post-war pacifism

'I saw people so injured you couldn't tell if they were dead or alive'

Nagasaki survivors on why Japan must not abandon its post-war pacifism
Jon Stewart: The voice of Democrats who felt Obama had failed to deliver on his 'Yes We Can' slogan, and the voter he tried hardest to keep onside

The voter Obama tried hardest to keep onside

Outgoing The Daily Show host, Jon Stewart, became the voice of Democrats who felt the President had failed to deliver on his ‘Yes We Can’ slogan. Tim Walker charts the ups and downs of their 10-year relationship on screen
RuPaul interview: The drag star on being inspired by Bowie, never fitting in, and saying the first thing that comes into your head

RuPaul interview

The drag star on being inspired by Bowie, never fitting in, and saying the first thing that comes into your head
Secrets of comedy couples: What's it like when both you and your partner are stand-ups?

Secrets of comedy couples

What's it like when both you and your partner are stand-ups?
Satya Nadella: As Windows 10 is launched can he return Microsoft to its former glory?

Satya Nadella: The man to clean up for Windows?

While Microsoft's founders spend their billions, the once-invincible tech company's new boss is trying to save it
The best swimwear for men: From trunks to shorts, make a splash this summer

The best swimwear for men

From trunks to shorts, make a splash this summer
Mark Hix recipes: Our chef tries his hand at a spot of summer foraging

Mark Hix goes summer foraging

 A dinner party doesn't have to mean a trip to the supermarket
Ashes 2015: With an audacious flourish, home hero Ian Bell ends all debate

With an audacious flourish, the home hero ends all debate

Ian Bell advances to Trent Bridge next week almost as undroppable as Alastair Cook and Joe Root, a cornerstone of England's new thinking, says Kevin Garside
Aaron Ramsey interview: Wales midfielder determined to be centre of attention for Arsenal this season

Aaron Ramsey interview

Wales midfielder determined to be centre of attention for Arsenal this season
Community Shield: Arsene Wenger needs to strike first blow in rivalry with Jose Mourinho

Community Shield gives Wenger chance to strike first blow in rivalry with Mourinho

As long as the Arsenal manager's run of games without a win over his Chelsea counterpart continues it will continue to dominate the narrative around the two men
The unlikely rise of AFC Bournemouth - and what it says about English life

Unlikely rise of AFC Bournemouth

Bournemouth’s elevation to football’s top tier is one of the most improbable of recent times. But it’s illustrative of deeper and wider changes in English life
A Very British Coup, part two: New novel in pipeline as Jeremy Corbyn's rise inspires sequel

A Very British Coup, part two

New novel in pipeline as Jeremy Corbyn's rise inspires sequel
Philae lander data show comets could have brought 'building blocks of life' to Earth

Philae lander data show comets could have brought 'building blocks of life' to Earth

Icy dust layer holds organic compounds similar to those found in living organisms