Merger between Yorkshire and Barnsley building societies

In a recent announcement two building societies have announced that they will be merging, but have said that there will be no resulting windfall for customers of either building society. The merger is to take place between the Yorkshire Building Society and the Barnsley Building Society.

Barnsley Building Society is said to have suffered possible losses as a result of the Icelandic banks, and following the collapse is said to have approached the Yorkshire Building Society. It is thought that as a result of its deposits with the failed banks Kaupthing Singer & Friedlander and Heritable Bank it may end up writing off around £10 million.

Following discussions relating to the merger it is thought that the process will be completed by the end of December. The Financial Services Authority has given Barnsley permission to proceed with the process without having to consult with members for the good of the society according to reports.

An official from Barnsley Building Society stated: ‘The society’s reserves are sufficient to absorb our potential losses to Icelandic banks, but the board considered that their reduced level would restrict its ability to provide members with the security and benefits associated with mutuality. In response, the board has made a very positive decision to lead the society into a more secure future as part of a larger society, through merger with Yorkshire Building Society, which shares our values and has a strong commitment to members, staff and local communities. This will provide the very best in terms of financial stability and expected future benefits for our members.’