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New chairman defends success of small societies

Hanley Economic Building Society chief executive David Webster hit out at criticism of smaller mutuals as he took over as chairman of the Building Societies Association.

webster
Webster: ‘We are still here’

In his first address as BSA chair at the association’s annual conference last week, Webster rejected concerns expressed about smaller societies.

He said: “Some commentators have asserted that building societies, such as the Hanley Economic, are sub-optimal in their size, that they need economies of scale and cannot survive in today’s competitive markets.”

But Webster pointed to the failure of Hbos and Royal Bank of Scotland as showing the vulnerability of big institutions.

He said: “There are, of course, some excellent examples of successful large institutions. Nationwide obviously comes into that category.

However, it would be difficult to describe Royal Bank of Scotland or Halifax as successful after the events of the last two years, whereas I would describe my own organisation and a whole range of other building societies as successful.

“Unlike the demutualised institutions, we are still here, we are well capitalised, we have lots of liquidity, low mortgage arrears and our service standards outshine those of the banks.”

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