Loyalty bonus for Bradford members
Monday 14 August 1995
Bradford & Bingley, which is committed to preserving its mutual status, is the first society to announce such plans but it expects others to follow its lead. The precise structure of the bonus scheme has yet to be finalised, but it is possible that borrowers who have held a pounds 60,000 mortgage for five years or more could expect a bonus of around pounds 800 every five years. Savers with more than pounds 10,000 invested could expect a similar amount if they have held the account for 10 years or more. All bonus payments will be linked to profit performance. Mortgage holders who fall into arrears with their repayments will be expelled from the scheme.
John Wriglesworth, Bradford & Bingley's general manager, said the scheme was a way of distributing to members the excess reserves which had been accumulating as a result of a slower mortgage market. Other alternatives such as paying a dividend or reducing the mortgage rate were ruled out.
Mr Wriglesworth said: "We think mutuality is defensible without this scheme but it does help. We hope that people will see there is a tangible benefit to mutuality." Other building societies such as Britannia, Yorkshire and Skipton are also examining loyalty schemes.
Mr Wriglesworth added that bonus payments from merging societies such as Halifax and Leeds were one-offs, whereas the proposed Bradford scheme will yield a rolling system of bonuses. The society stresses that investors with lower savings or mortgages will also benefit but will have to wait longer for the payments to begin.
The move towards bonus payments is the latest weapon used by building societies to fight takeovers and to stem the tide of "hot money" as investors place minimum funds in accounts hoping to cash in on possible takeovers.
- 1 Scottish independence: Ireland since 1919 is a lesson for Scotland in what a Yes vote means
- 2 Watch a man race the Circle line and win
- 3 A bottle of wine a day is not bad for you and abstaining is worse than drinking, scientist claims
- 4 Grandmas keep accidentally tagging themselves as Grandmaster Flash on Facebook
Islamic State: Pope is 'being targeted by Isis', Iraqi ambassador to the Holy See warns
Jennifer Lawrence and Kate Upton nude pictures exhibition cancelled after artist concedes photos were 'stolen property'
Scotland independence: A nation divided against itself: Brown says SNP are liars. Darling joins in. Salmond fights back...
John Travolta addresses former pilot's gay romance allegations publicly for the first time
Richard III: Two years after his body was found, scientists discover how he died
Daniele Watts: Django Unchained actress detained by Los Angeles police after being mistaken for a prostitute
The political class is doing what Hitler couldn’t – destroying Britain
Scottish independence: Nationalist leader Jim Sillars threatens pro-union companies with 'day of reckoning' after independence
Scottish independence: Yes campaign feels the heat as Alex Salmond's NHS claims come under furious attack
Portuguese academic says British are 'filthy, violent and drunk'
£23m Birmingham cycle scheme is attacked by Tory councillor for not catering to the elderly
iJobs Money & Business
£20 - 24k (Uncapped Commission - £35k Year 1 OTE): Guru Careers: We are seekin...
£20 - 24k + Benefits: Guru Careers: This is a great opportunity for an enthusi...
£280 - £320 per day: Ashdown Group: The Ashdown Group have been engaged by a l...
£400 - £450 Per Day: Clearwater People Solutions Ltd: **URGENT CONTRACT ROLE**...