Nationwide is hoping it has strengthened its position in the last three years to withstand another attack from carpetbaggers.
Britain's biggest building society will decide in a board meeting next month whether it will oppose a new call for demutualisation.
The lender faced the carpetbaggers in 1998 when it won the vote to remain mutual by a slim majority.
But the three year grace period on further attempts, incorporated into its rules for added protection, runs out next year and the board must decide whether it will allow a resolution on conversion to be included in its AGM in July 2001 or risk facing a special general meeting.
The man leading the last challenge – Andrew Muir, a Surrey-based financial consultant – has announced he will reignite the campaign next year. He needs the support of 500 members to call an SGM.
If the lender is facing this proposition at some point next year, it may well prefer to do it at the AGM, on its terms rather than be forced to arr ange an SGM.
Media relations manager Alan Oliver says: “An SGM is costly as it has to be arranged at very short notice and is disruptive to the business. It also puts the control of the event into the hands of the carpetbaggers.”
Oliver stresses that the board has not made a decision yet and the issue is only being added to the meeting's age nda so an early decision can be made and people will know where they stand. But this move also gives the opposition more time to gather support and build its case.
Whatever the board dec ides, Nationwide is going to have face a challenge in the next year and is going to have to start on the campaign trail now to convince its members.
Why should members res ist the lure of windfall payouts?
Oliver says Nationwide is doing a lot to promote the benefits of mutuality. By April, it is forecast to have returned £1.4bn to its members over the last five years through a combination of better rates and the abolition of fees and charges rather than paying dividends to shareholders.
The lender just announced it will reduce its standard variable mortgage rate from Dec ember 1, 2000 by 0.2 per cent to 7.09 per cent.
Oliver says: “We are not just starting to do this, we have got a good track record and people will be able to see we have given back this money. We do not need gimmicks and members can see that. I hope this message gets across to make sure members vote in the knowledge of what we have done and I would hope they have seen the benefits of us remaining mutual.”
Three years down the line, Oliver is confident that the next wave of potential carpetbaggers will have to contend with a changed environment in favour of remaining mutual.
Back in 1998, members bore witness to a series of building society demutualisations, which delivered large windfalls for their members.
According to Oliver, the environment has now chan ged. He says: “Woolwich, Hal ifax and Alliance & Leicester all went in the space of a year and there was a certain mom entum which was tough to fight against.
“But they have all had a difficult time and are active examples of companies that have not set the world alight since demutualising.”
Nationwide hopes its performance over the last three years will have taught members the value of staying mutual.