More building societies to merge in 2007
Business advisory firm, Deloitte predicts further building society takeovers in the wake of Nationwide’s takeover of Portman Building Society.
2007 will see as many as a further 5 mergers as struggling building societies look for ‘white knight’ mutual merger partners, reckons Stephen Williams, head of the building societies team at Deloitte.
However, according to Mr Williams, there are a large number of societies, determined to remain independent, which are looking closely at their revenue models for each product and customer segment.
Stephen Williams commented: “One of the great strengths of building societies is the ability to make quick decisions and be fleet-footed in the marketplace. Intuitively, by combining innovation and speed to market, with service excellence and the embedded culture of putting customers first, there is a real opportunity to succeed.”
“A building society that can achieve the holy grail of cross-selling to its customers by understanding what they need, and being trusted to tell them that it can provide a solution, will flourish.”
The Deloitte recommends that mutuals look to the US for inspiration on how to keep their customers satisfied. The Commerce Bank of New Jersey not only opens its branches seven days a week, but keeps them open until 8.00pm and makes sure the doors open ten minutes before the official opening time, so customers don’t have to wait in the rain. Its revenues and profits are growing at 30 per cent a year.
In Dubai, mobile bank branches operating on local area networks, physically move location during the day to ensure they are in the right place when people leave work.
Stephen Williams added: “While societies have come a long way in the last five years there is still a danger of navel gazing. They should be looking at what retailers are doing, be open to new ideas and actively listen to what their customers want.”
“Imagine a building society that is located where customers want it to be and which thinks about what they need, but which also has a competitive cost-income ratio. Societies can and should realise this dream.”
Nick Sandall, head of retail banking at Deloitte, concluded: “With the high street banks achieving economies of scale through cross-border M&A activity, the building societies are under pressure to reduce their costs if they are to stay competitive.”
“Mutuals are generally well trusted by UK consumers, so by strengthening their position in the market and putting the customer firmly first, they can continue to offer good value products and challenge the banks."
Business advisory firm, Deloitte predicts further building society takeovers in the wake of Nationwide’s takeover of Portman Building Society.
2007 will see as many as a further 5 mergers as struggling building societies look for ‘white knight’ mutual merger partners, reckons Stephen Williams, head of the building societies team at Deloitte.
However, according to Mr Williams, there are a large number of societies, determined to remain independent, which are looking closely at their revenue models for each product and customer segment.
Stephen Williams commented: “One of the great strengths of building societies is the ability to make quick decisions and be fleet-footed in the marketplace. Intuitively, by combining innovation and speed to market, with service excellence and the embedded culture of putting customers first, there is a real opportunity to succeed.”
“A building society that can achieve the holy grail of cross-selling to its customers by understanding what they need, and being trusted to tell them that it can provide a solution, will flourish.”
The Deloitte recommends that mutuals look to the US for inspiration on how to keep their customers satisfied. The Commerce Bank of New Jersey not only opens its branches seven days a week, but keeps them open until 8.00pm and makes sure the doors open ten minutes before the official opening time, so customers don’t have to wait in the rain. Its revenues and profits are growing at 30 per cent a year.
In Dubai, mobile bank branches operating on local area networks, physically move location during the day to ensure they are in the right place when people leave work.
Stephen Williams added: “While societies have come a long way in the last five years there is still a danger of navel gazing. They should be looking at what retailers are doing, be open to new ideas and actively listen to what their customers want.”
“Imagine a building society that is located where customers want it to be and which thinks about what they need, but which also has a competitive cost-income ratio. Societies can and should realise this dream.”
Nick Sandall, head of retail banking at Deloitte, concluded: “With the high street banks achieving economies of scale through cross-border M&A activity, the building societies are under pressure to reduce their costs if they are to stay competitive.”
“Mutuals are generally well trusted by UK consumers, so by strengthening their position in the market and putting the customer firmly first, they can continue to offer good value products and challenge the banks."
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