After the annual meeting in a marquee on a cricket pitch in Bingley, West Yorkshire, next to the society's headquarters, executives said the society's conversion would take the form of an independent listing on the London Stock Exchange. This is likely to take place within 15 months after members formally approve conversion plans.
Likely predators for Bradford & Bingley include Lloyds TSB, NatWest and AXA, the French insurance giant. Claude Bebear, group chief executive of AXA, is interested in buying a UK building society.
Lindsay MacKinlay, B&B chairman, said the board would have a duty to consider approaches from interested bidders if it affected the value of the society when it converts. "It would be most unwelcome, but the board would obviously have to think about the options." However, he said the board had received no approaches so far.
Analysts believe an independent B&B would achieve a market capitalisation of between pounds 2.5bn and pounds 3bn if it floats. The society has 220 building society branches, 400 local agencies and 370 estate agents. It also has 7,700 staff and reserves of pounds 1bn.
Recently B&B revamped its image after research showed that the bowler- hatted image of Mr Bradford and Mr Bingley was sexist. Last year the society made post-tax profits of pounds 84m, up 33 per cent on the previous year.
Christopher Rodrigues, chief executive of B&B since 1996, said he was disappointed by the vote, which represents an emphatic rejection of his arguments in favour of mutuality. "I am very sad about what happened today, but democracy has taken its path and I happen to believe in democracy."
He insisted there was nothing to prevent him continuing as chief executive. He still believed in the principle of mutuality, but customer service would not be affected. "I will do everything in my power to carry out the members' wishes going forward."
Executives admitted savings rates would go down and mortgage rates up as a result of the vote. They said the society would have to be more efficient, suggesting further cost cuts are likely. They declined to comment on a likely level of redundancies.
After closing to new savings customers for four months, Bradford & Bingley will reopen all products to new customers.
At the meeting yesterday, angry pro-mutual members expressed disappointment at the vote. Some called for the board to continue its campaign against conversion ahead of the formal vote due later this year. One said: "There is still time to stress, by fighting like political lions, that members should still vote against conversion. The board should carry on that fight."
Outlook, page 13