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News in digestible form
Welcome to the June edition of our e-newsletter, BSA Newsbite. A monthly online update, Newsbite gives you the latest news, views and stats from the building society sector.
This update is complemented by the Summer edition of Society Matters, which has now been published. This edition focuses on lost accounts. To request a postal copy and to be added to the distribution list click here or to download a copy from the BSA website click here
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Building society statistics 2007
Recently published statistics from the FSA show that the building society sector continued to be in strong position in 2007, indicating that societies can face future challenges with confidence.
At the end of 2007 there were 59 building societies following the merger of Nationwide and Portman. While there were three mergers between societies in 2006, there have been just six mergers in total in the last seven years. The recently announced merger between Chelsea and Catholic suggests that the consolidation of the sector will continue to be gradual in the future.
At the end of 2007, over 23 million investing members had savings accounts with building societies. However, a number of investors have accounts with more than one society, so the number of individuals investing with building societies will be below this figure.
Building societies raised £41.9 billion of funding in 2007, compared to £27.5 billion in 2006. Just under half of this funding was raised in the final quarter of 2007. A significant proportion of this funding will have been due to money withdrawn in the run on Northern Rock bank being deposited with building societies.
Building societies had more than 2.9 million borrowers at the end of financial 2007. Total lending in financial 2007 was £75 billion, up 16.8% on the amount lent in 2006. According to the FSA, building societies and their subsidiaries had a 20.1% share of all net lending in 2007, greater than their 18.5% share in 2006.
Read the full article
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Saving Gateway – simplicity is key
The Saving Gateway is a saving scheme aimed at those on low incomes that the Government intends to launch nationally in 2010. Under the scheme, the Government offers to match a proportion of any deposits made by the saver.
In its submission to HM Treasury on the Saving Gateway, the BSA urges the Government to keep the scheme as simple as possible to benefit both savers and providers, and to expand the scheme to a wider target group. The BSA also suggests that participation in the scheme will be encouraged via a higher match rate.
The BSA supports the principles of the planned Saving Gateway scheme, and believes the general design of the scheme is well thought out. In particular, we support the idea that the scheme be kept as simple as possible to enable the target group to understand the scheme. The aim of the scheme is to get people who don’t save to do so. The group being targeted is therefore likely to find mainstream financial service providers unfamiliar and have low levels of financial understanding, so simplicity is key.
Keeping the scheme simple will also make it viable for those providers that choose to do so to offer the product.
Read the full article
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Diverse governance at building societies
Building society boards of directors are more diverse in terms of gender than the boards of publicly quoted companies on the FTSE 100 or the FTSE 250. This diversity can provide a wide basis of experience which can benefit decision making at building societies.
This analysis is based on information in building society annual reports and accounts for the financial years ending before 5 February 2008, as well as the Female FTSE 2007 Report.
There were 523 directors at the 59 building societies in the UK, of which 153 were executive directors and 370 were non-executive directors.
Of the 523 building society directors, 69, or 13.2%, were female, and most of these were non-executive directors (59, or 15.9% of non-executives) rather than executive directors (10, or 6.5% of executives).
Building societies as a whole compare well to publicly quoted companies. In the FTSE 100, 11.0% of all directors are female, and on FTSE 250 boards the proportion is just 7.2%.
The average age of executive directors at building societies is 49.8 years old, and for non-executive directors it is 58.0. Both of these are lower than the average age of a director across all FTSE 100 companies, which were 50.9 years for executives and 58.8 for non-executive directors.
Read the full article
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BSA expands mortgage service
The BSA is to expand the work which it does on behalf of building societies by representing their interests in the mortgage and housing markets. Building societies are keen to build upon their good reputation and believe that their best interests can be served by BSA representing them in all of the major markets in which they operate.
During the second half of 2008 the BSA will be recruiting up to seven additional members of staff to fill this gap in the range of services which it offers to its members. The new service will be launched in January 2009.
To read the press release click here
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BSA welcomes new Associate
Clayton Euro Risk is a specialist consultancy business focused on credit and risk encompassing all branches of consumer finance including first and second mortgages, unsecured lending of all types, dealer and motor finance.
To find out more about them check out their website www.claytonerm.com/
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And finally ...
If Newsbite has been forwarded to you by a colleague and you would like to get your own copy direct, or if you would like to unsubscribe just e-mail the Media Centre.
For feedback, opinions and information, contact Newsbite’s editor Rachel Le Brocq.
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BSA IN PRINT, MEDIA RELEASE, 20 JUNE 2008
Is now a good time to buy?
"Although 51% of people don’t think that now is a good time to buy property, the surprising finding of the first quarterly Property Tracker survey by the Building Societies Association (BSA) is that 27% of people agreed to some extent that now is a good time to buy property in the UK."
To read the full release click here
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