Qualified advisers answering your
Financial Questions
call 0800 092 1245

Mutual societies under pressure on debt downgrade

The credit rating agency Fitch has confirmed that the debts of the Nationwide building society, the largest mutual in the UK, has been downgraded from stable to negative due to the pressure placed upon the Nationwide balance sheet by the recession. Fitch believes that further weakness in the loan book of the Nationwide building society will impact upon the company's profitability and financial strength for at least the next 12 months, although Nationwide is by no means alone in the mutual sector.

The credit agency has also downgraded debt ratings for the Chelsea building society, Coventry building society, Leeds building society, Principality building society, Skipton building society and the Yorkshire building society. This is a sector which for many years was seen as rock solid but after the recent decision by the management of the West Bromwich building society to convert some of their debt into permanent interest-bearing shares, the situation has changed.

The truth is that the mutual society of yesteryear may well have gone for the foreseeable future as financial needs in the current market have changed dramatically over the last two years. The future financial sector in the UK will be very different to the one we knew just two years ago due to the stresses and strains caused by the credit crunch and the ongoing recession.

Share this..

Related stories

Financial Guides

Financial Calculators

Our useful calculators can help you get your finances in order:

Latest News


Helpful new tax year facts that could affect you and your money

Blog | Seven helpful new 2016/2017 tax year facts that could affect you and your money. Our recent online blog shares a brief outline on how to stay up to date.

Read more

Useful Links

Popular Searches

Please Enter More Details

Enter More Details