David Prosser: Comeuppance for carpetbaggers

Outlook Despite their travails with the FSCS, there were some wry smiles to be seen in Nationwide's Swindon head office yesterday. The building society says it doesn't feel smug about the fate of three building societies with which it once did battle, but their disappearance certainly vindicates its own decision to stay mutual.

For several years in the late Nineties, it was a close-run thing for Nationwide, which narrowly defeated a number of attempts by members to have the society demutualise. Those members were tempted by the windfalls received by customers of societies such as Bradford & Bingley, Alliance & Leicester and Abbey – all of which, Santander said yesterday, will now be subsumed into the Spanish bank's brand – as well as pay-outs to Halifax customers and, of course, those of Northern Rock.

There's no need to dwell on what has happened to each of the organisations that did decide that conversion to banking status was the right decision for them. Suffice to say that these days, the argument of the time, demutualising would give the societies access to more flexible business models – securitisation, anyone? – and enable them to expand and diversify, rings somewhat hollow.

Nationwide, on the other hand, dismissed such arguments and the venal instincts of some of its members, many of whom were carpetbaggers who joined the society purely so they could cash in if it converted. Britain's biggest building society has had the last laugh.