Yorkshire building societies to merge

SKIPTON Building Society and Scarborough Building Society have announced they are to merge.

In a joint statement the two societies said that they had agreed heads of terms for a merger – which is expected be completed in the first quarter of next year.

Describing the move as a real opportunity the statement said the enlarged business would be “better placed to deal with any future uncertainties in the financial marketplace.”

Scarborough Building Society has been affected by the difficult trading conditions which have led to a substantial impact on profit.

The board said that after considering the possible impacts of continuing house price falls and the impending recession in the UK it approached Skipton Building Society as its preferred merger partner.

In a bid to preserve the capital reserves of the enlarged group, members of the two societies will not receive a windfall.

David Cutter will become chief executive of the enlarged Society, which will be called Skipton Building Society and will be headquartered at The Bailey, Skipton.

The current chief executives of both societies, John Goodfellow and John Carrier, will continue with their planned retirements at the end of this year.

It is anticipated that the enlarged Society will be a top five building society with approximately 860,000 members and more than £16bn of assets.

John Goodfellow, chief executive of Skipton Building Society, said: “I am delighted that the societies are merging and this is beneficial to members. By joining forces, these two societies will create a significant force in the building society sector – a modern mutual that is set to grow further in the years to come. There are benefits for both sets of members, who can look forward to a continued relationship with a building society that puts their long-term interests at the heart of what it does.”

John Carrier, chief executive of Scarborough Building Society, said: “We have been in talks with Skipton for some time and have now reached an agreement to merge. A merger of the societies will create a much larger, stronger business in North Yorkshire which offers real advantages to both organisations and their members going forward, in view of the strengths and values we share, our close geographical location and our ethos of returning good value to our members.

“We believe this merger is in the long-term best interests of our members, our people and our local community, and can only serve to enhance the building society sector.”

Skipton was founded in 1853 and is the UK’s 6th largest building society with more than 660,000 members.

Scarborough was founded in 1846 and is the UK’s 17th largest building society, with around 200,000 members across the UK.

The merger terms are subject to final agreement by both societies.

A team from Addleshaw Goddard in Leeds represented Scarborough Building Society on the merger.