TWO OF the top 10 building societies, the Leeds and the National and Provincial, yesterday announced their intention to merge, forming the third biggest in the UK - but at the cost of 1,600 jobs, writes John Willcock.
The announcement prompted outrage from employees' organisations and local councils in the Pennines which will bear the brunt of the job losses. However, the societies' top management and City commentators were cock-a-hoop at the move, which they believe will produce big economies of scale.
The new society, to be called 'the Leeds', will retain the Leeds's advertising character - the fictional Arthur Daley as played by George Cole - and the NatPro's 'Busy Bee' logo.
About 15 per cent of the combined network's jobs and branches will go, leading to 119 branch closures. The new group will be based in Leeds; N & P's Bradford head office will be downgraded to an 'activity centre'.
Gerry Sutcliffe, leader of Bradford City Council, complained that the first he heard of the merger was from a radio journalist asking for an interview at 11.30am. 'It's absolutely devastating news for us, coming on the heels of the loss of assisted area status. We estimate Bradford will lose pounds 10m a year in income from the closures.'
The Banking, Insurance and Finance Union warned that the 1,600 job losses could be 'just the tip of the
Investors and borrowers need to approve the merger, and there are signs that it may meet strong opposition since no sweeteners, in particular payouts to savers, have been offered. The move is expected to herald a fresh wave of mergers and job losses.
More mergers in prospect, page 25
View from City Road, page 26
Join our new commenting forum
Join thought-provoking conversations, follow other Independent readers and see their replies