Simon English: Let's not get too misty-eyed, but Nationwide is a national treasure
Thursday 24 May 2012
Outlook There aren't many good sides to the banking crisis, but one must be this: at least all those loonies that wanted Nationwide Building Society to become another bank, as if that's just what we needed, have shut their traps and slunk away.
Back in the 1990s when perfectly solid and respectable building societies were being converted into high-risk banks with relentless gusto, the pressure to get Nationwide to do the same was intense.
They'd give "free" shares to members! Charities would benefit! And the banks would have one less serious competitor (they always forgot that last point).
Some of that pressure came from people who, one hopes, are now slightly ashamed of themselves.
The corporate affairs directors of at least two converted building societies lobbied journalists over lunch at the Coq d'Argent (it was good back then) pushing the case for editorials demanding that Nationwide do the right thing.
The hacks who did more than merely enjoy the food and wrote as they were bid have hopefully since had a word with themselves too.
All of the converted building societies went bust at our expense. It was a disastrous experiment, for which one is tempted to place the ultimate blame on Margaret Thatcher, if only out of habit.
It would be a mistake to get too misty-eyed about any organisation as large as Nationwide, and doubtless it has faults and makes errors. But broadly it is a national treasure. Results out yesterday show that it is perfectly possible for a responsible, well-run company to increase mortgage lending, to do mostly right by savers, and even to move into loans for the beleaguered small business sector, recession or no.
Students of the best buy tables will say that Nationwide isn't always at the top, which is to miss the point. The society isn't claiming it will always offer the best deals, just that over the life of a mortgage, or indeed a person, if you always banked with them, you'd come out better than if you stuck with, say, Halifax.
Nationwide's status and success is a permanent affront to the banks, a constant reminder that besides being a danger to everyone including themselves, they aren't even much cop at the most basic activities for which they supposedly exist.
If you make your starting assumption that a financial product sold by a bank sucks, you won't usually go far wrong.
If every bank was put out of our misery, and all that remained was three or four Nationwide-like organisations, competing responsibly and doing the right thing in the long term, wouldn't Britain be a better place?
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