West Bromwich Building Society to be rescued

11 June 2009

Commenting on reports that the West Bromwich Building Society is to be rescued, Kevin Mountford, head of banking at moneysupermarket.com, said: "If the reports about the West Bromwich Building Society (BS) are true it will be another sad day for the sector. However, West Bromwich's customers can be re-assured that the FSA and Treasury appear to be engineering a seemless transition. All the same, it reinforces the fact that consumers should spread their savings to ensure they have no more than £50,000 with any one provider, to stay under the FSCS compensation limit.

"The building society movement could have been a big winner from the credit crunch, but sadly it now seems that, like banks, many of them took inappropriate risks. The demise of the West Bromwich BS is likely to mean another financial services brand disappears from the high street. Ultimately, consumers will be the losers with less choice and competition for savers and borrowers.

"Whilst there have been reports that we have reached the bottom of the economic cycle and can now look forward to a recovery, for the bank and building society sector this clearly isn't the case and the reports regarding the West Bromwich BS shows that there could well be more casualties before we are finished."