Speaking at the Building Societies Association Conference Dinner in Yorkshire last night, Nationwide chairman and newly appointed BSA chairman Graham Beale revealed his mutual’s huge FSCS levy before the building society releases its 2008 accounts next week.
Beale said: “When we announce our annual results next week they will include a charge and provisions in excess of £250m. This amounts to the daylight robbery of our members and the operations of the FSCS must be changed to prevent a repeat of this injustice in the future.”
Beale also warned that “anomalies” in the FSCS structure allow unfair advantage to the larger UK banks. Under a temporary FSA ruling, merged building societies currently keep separate compensation limits for each brand, but banks do not come under the same ruling, meaning if they decide to merge, their limits mulitply.
He said: “£50,000 is the most protection we can offer. If we were a bank we could offer £200,000 across the group. So much for a level playing field.
“Now is the time for the Government to make clear its commitment to the mutual sector, to turn words into action and to provide the same level of support to our sector that has been provided to the plc banking sector.”