Members of the Irish Nationwide building society have overwhelmingly backed the board's intentions to abandon its mutual status, with its chairman signalling it could hope to yield windfall payments of at least €7,000 on each qualifying account in about 18 months.

Addressing its annual general meeting in Dublin yesterday, chairman Dr Michael Walsh said the board would speedily move the conversion process on as soon as new legislation, which could be passed as early as next month, is adopted.

"It will probably take 12 to 18 months if we were to start as soon as the legislation is in place and we will endeavour to do that with more haste," he said. "We have indicated that once this is in place we intend to avail of that and begin the disposal of the society in the best interests of all shareholders."

Irish Nationwide has made it clear to its members that they will have to wait for the business to be sold before unlocking the value of their membership. The society, which reported profits of €117 million last year, could be valued at up to €1 billion. Dr Walsh said he believed the sale of the society was the best way for members to realise the value of their investment.

To qualify for a cash payment when a sale has been completed, members must hold a share deposit account or a mortgage with Irish Nationwide. Under the building society legislation, savers must maintain a minimum balance of €125 in their deposit account from July 1st of the previous year and up to the day on which the members formally sanction the conversion.

In the case of borrowers, they are required to have a minimum debt of €625 in their account at the end of December 2004 and continue to maintain this balance until the members pass the conversion motion.

Dr Walsh said that while it was difficult to tell how much money these members will actually receive at this stage, he said he would be disappointed if it wasn't at least €7,000 per qualifying account. "That will be dependent on the purchase price," he said, while adding that he wouldn't want any buyer to believe they could get Irish Nationwide on that basis. "We will be looking for the best deal for all shareholders. We have no preconditions," he told the meeting.

The society's chief executive, Mr Michael Fingleton, has suggested he would like to see its 425 staff and management benefit under an Employee Share Ownership Plan. Staff could be offered up to 15 per cent of the new bank, something that would reduce the size of the payout to the society's members.

Mr Brendan Burgess, who unsuccessfully campaigned to unseat Dr Walsh and replace him as a director, objected to such an arrangement and asked the chairman to give an assurance that this wouldn't happen. Dr Walsh replied that he was unable to give such a commitment saying these people had built the business. "They are pretty fundamental to its success," he added.

The details of the proposed conversion scheme designed by Irish Nationwide's board of directors will have to be first approved by the Irish Financial Services Regulatory Authority and subsequently by its members.