The EBS building society has told members that it is having "tentative discussions" with some of Europe's large mutual banks that could lead to a future link-up, writes Siobhán Creaton
Its chairman, Mr Brian Joyce, said the society had learned a lot from these banks and that any future agreement could enable it to offer a wider range of products as a mutually owned society.
"We are not contemplating going away from mutuality. We need changes to legislation before we could avail of some opportunities that would enable us to develop the mutual model even further," he said.
The EBS has been linked to the Dutch Rabobank group, which owns ACCBank and has operations at Dublin's International Financial Services Centre.
Mr Joyce told members at the EBS annual general meeting in Dublin yesterday that the new legislation could be passed within the next three months. The new legislation will also usher in changes that will allow the Irish Nationwide building society to shed its mutual status and it is seeking a potential buyer.
Mr Joyce said the EBS would soon be the Republic's "last remaining mutual". The society was trying to give its members a "different experience", he said, and was very keen to differentiate itself from ordinary banks.
The EBS has spent the past 12 months meeting members to ascertain what they think and expect from the society. One of the key findings was the huge antipathy expressed by members about the discounts offered to entice new mortgage customers while existing borrowers paid higher rates of interest.
Since the end of March, the EBS has abolished this practice and now operates a single standard variable rate of interest for all customers. "In the future we will give long-term customers whatever benefits we can," he said.
It has also introduced a new membership bond for members who have been with the EBS for more than five years, offering a rate of interest of 2.75 per cent. Mr Joyce said that 20,000 members joined the EBS last year.
The hundreds who attended meetings were treated to a corporate video that extolled the virtues of mutuality for its customers. Staff members also spoke enthusiastically about their employer, as REM's Shiny Happy People played in the background.
One member mentioned that while the EBS was gaily emphasising the benefits of retaining its mutual status, he had noted that just six members of the former First Active bank had voted to retain its status as a building society when it had converted to a public company.
