Are any of the building societies a safe place to leave your money these days?

We were all assured just two months ago that we’d seen the last of the building society emergency takeovers with the demise of the Dunfermline but now it seems that we’re starting on yet another round of emergency takeovers as West Bromwich seems to be in its final days as an independent society.

The snag now is that Nationwide appears to have more than enough on its plate already and notably declined to take over all of Dunfermline which was a change to its previous approach of absorbing troubled societies in their entirety and merely took on the savings and regular mortgage parts of the society, leaving the part that caused the trouble well alone. Whatever society takes over the West Bromwich that seems likely to be the approach that they will take as otherwise those problems could well pull down the new owners as well.

Aside from the Nationwide which is probably too busy trying to integrate the societies that it has already picked up, the obvious choice would appear to be the Coventry although that seems likely to involve a number of branch closures over time given the similar geographic spread of the two businesses. The other problem is that the societies have a similar number of branches thus a takeover would pretty much double the number of branches to be looked after which could stretch the management a little bit too much in what are already difficult times. My bet is that, if it is a building society takeover, it will be a toss up between the Chelsea and the Yorkshire who will do it.

But what about the remaining building societies? Falling foul of the recent downgrade were West Bromwich, Chelsea, Britannia, Coventry, Nationwide, Newcastle, Norwich & Peterborough, Principality, Skipton and Yorkshire. Of these, only Chelsea appealed and Britannia is currently being taken over by the Co-Operative Bank.

As always, the safest place for your money remains National Savings.

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