Halifax makes a date with the windfall hunters

Nine million customers now know when to beef up their balances to make the most of the share handout. Steve Lodge reports
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The Independent Online
The Halifax building society last week confirmed the timetable of what is set to be the biggest-ever extension of share ownership in the UK: its planned handout of free shares worth an average of pounds 1,000 each to 9 million savers and borrowers as part of its conversion into a bank.

The Halifax will be writing in November to customers awaiting their free shares, reminding them to top up their balances to maximise their windfall.

All savers who are eligible for the handout should keep a total of at least pounds 100 in qualifying accounts, and ensure that they have this pounds 100 with the society on 31 December this year.

As well as a basic handout of shares worth perhaps pounds 500, savers with pounds 1,000 in their accounts in November 1994 - when the society announced the windfall - will get extra free shares.

For some savers with big balances, these could be worth thousands of pounds.

These pounds 1,000-plus savers are being reminded that they may need to top up their accounts by February 1997 - the actual date will be given in January - to maximise their windfall. To receive the best possible number of extra shares, these savers should ensure that their total balance on the February qualifying date is no less than that on the original qualifying date in November 1994.

After the date next February, when the vote on the Halifax's demutualisation will take place, savers can run down their total balance to the basic pounds 100 without affecting their windfall eligibility. In the meantime they can touch their savings with impunity so long as they leave the basic pounds 100 in their accounts.

The Halifax is unusual among societies handing out windfalls in that it is actually warning savers in advance when they need to top up their accounts to maximise their windfall gains. Apart from the Halifax, only the Woolwich has said savers can make withdrawals now without affecting their handouts.

With other societies, it is not yet clear whether savers, particularly those with larger balances, will lose out by making withdrawals now.

The Alliance & Leicester is expected to announce details of its share handout imminently. The plan is that 3 million Alliance & Leicester savers and borrowers will receive an average of perhaps pounds 800 of free shares some time in spring 1997.

Assuming, as expected, that Halifax customers vote in favour of the society becoming a bank - which will trigger the handout - then in April or May of next year they will be sent confirmation of how many shares they will get. If all goes to plan, these shares will be given out in June when the Halifax joins the stock market as a bank.

Halifax customers will know the likely value of their handout in January when details of the conversion process are published.

The society also said this week that it will offer a service allowing customers to sell their Halifax shares free of the normal dealing commission for a limited period after the handout.

It is also considering offering a low-cost personal equity plan (PEP) into which customers could transfer their Halifax shares, which would make dividends and any subsequent capital gains tax-free.

The society has published a new leaflet, "Next Steps to Conversion - How it affects you", which is available in branches and will be sent out in late November with the reminder about how to maximise windfalls. This mail-out will also give customers the opportunity to check the account details held by the Halifax which will be used in determining their windfall eligibility.

The Halifax has a helpline (0800 888844) for inquiries about the windfall. It will also be open to customers who think they should qualify but don't receive the reminder.

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