Turnout raises B&B hopes in ballot

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The Independent Online
BRADFORD & BINGLEY Building Society will today announce the results of a close-run vote on whether to turn itself into a bank or maintain mutual status, following a turnout of over 60 per cent of its members.

A spokesman for the society said yesterday that over 1.6 million of 2.5 million eligible members voted. He said: "This is as big a turnout as we expected. It has created a clear result. We are pleased, as we wanted a meaningful result."

The result will be announced at the society's annual meeting at 3pm today in Bingley, West Yorkshire. It will have a huge impact on the surviving mutual societies; most analysts expect that if Bradford & Bingley goes, then Nationwide and the rest will follow by demutualising as well.

Members are voting on a proposal from Stephen Major, a 35-year-old plumber from Lisburn in Northern Ireland, asking the board to take steps to become a bank and distribute shares to members. The board, led by Christopher Rodrigues, the chief executive, is vehemently opposed.

No building society membership has so far voted to demutualise against the wishes of the board. Other societies that have voted to convert, such as the Halifax, did so with the full support of the board.

Experts on the sector yesterday said the high turnout was in Bradford & Bingley's favour. John Wrigglesworth, the demutualisation guru who recently worked for the B&B, said he was confident of a vote in favour of mutuality.

"The number of votes means quite a lot of people who want to obey the board's wishes have turned out. If it was a low turnout you would expect it to be just the carpetbaggers voting. I will be exceptionally surprised if the board doesn't know how the vote is going - and they haven't stepped up advertising, or extended branch opening times."

Mr Major, who gained the 50 nominations he required after articles were printed in two national newspapers, said he was "very hopeful" of a vote in favour of conversion. "But I think it will be close," he added.

A vote in favour of conversion will not force the society's board to float the society because it is not legally a conversion vote. But executives have indicated that a decisive vote in favour would lead to a full vote on conversion.

According to Mr Major's resolution, members could expect to receive around pounds 2,000 each if the society floated. However, City analysts have put the figure at around pounds 1,000.

The society has suspended new savings accounts to stop carpetbaggers from speculating on the society's future, allowing staff to concentrate on normal business. A vote against conversion would allow them to reopen new account business.