Letter: Fair shares

Sir: I must take issue with your statement that the terms of the Birmingham Midshires demutualisation are "grossly unfair on borrowers" (Business Outlook , 28 October).

Building societies legislation states that no borrowing member or saver with less than two years' membership is allowed to receive a different amount of shares from any other recipient of shares. That is why these members will each receive 400 Halifax preference shares.

You concede that "this may be so" bit go on to claim that the industry's trade body, the Building Societies Association (BSA), "does not appear to agree" that there are restrictions on the amount societies can distribute to borrowers during the demutualisation process. The BSA has subsequently told your newspaper that it misinformed The Independent about the impact of legislation.

Our windfall scheme is fair and where we can do more than the law allows, such as with young savers and heirs, we have done so. But there are limits and the law is the law.

TONY McGARAHAN

Head of Corporate Relations

Birmingham Midshires Building Society

Wolverhampton