The Nationwide and Portman, two UK-based building societies, are to merge in the biggest building society marriage, creating a mutual with assets of more than £150 billion (€222 billion).
The enlarged entity, to be called Nationwide Building Society, will be led by Graham Beale, currently Nationwide's finance director, and will become the second-largest mortgage lender and second-largest retail savings provider in the UK behind HBOS.
"It is intended that the majority of Portman's branches will be incorporated into the network of the enlarged society and rebranded Nationwide," Nationwide said yesterday. Qualifying Portman members are expected to receive a pretax merger bonus of £200.
Robert Sharpe, chief executive, Portman, said yesterday: "If building societies are to continue to compete successfully with the retail banks, they need to enjoy comparable economies of scale." He added that the merger was a "great deal" for Portman members.
The merger comes after the demutualisation of Standard Life, the life assurer that floated on the London Stock Exchange in July. Asked if the merger might be a prelude to demutualisation, a spokesman for Nationwide said: "No, absolutely, definitely not."
