Move against building societies grows with news of payoffs
For many years the building society sector has been seen to be the consumer's friend and a lot less aggressive than the leading UK banks. However, after the events of the last 7 days, which saw the Nationwide Building Society step in to rescue the Derbyshire and Cheshire building societies from collapse, the mood is starting to changes.
Apart from the matter of many investors having all of their savings and investment pooled together between the three parties in question, and losing some vital protection from the regulator, it now appears that those at the head of the Derbyshire and Cheshire are in line for large payouts.
It has been suggested in the popular press that £1.6 million has been put aside to buyout the contracts of 6 of the top directors from the Derbyshire and Cheshire building societies. If this is confirmed it is sure to infuriate savers even more because many will see it as a reward for failure. But is that fair?
Life has been very tough for all financial institutions in the UK not to mention particularly difficult for the smaller ones. If the Nationwide had not stepped in with a rescue package there is every chance that we would be discussing two failures in the financial sector. It is tough, but it could have been a whole lot tougher!
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