Sunday, July 11, 2010

Building Society Succumbs to Corporate Temptation

JC Flowers plans building societies lifeboat

Building Societies are looking increasingly vulnerable to corporate vultures as American outfit JC Flowers wraps its financial tentacles around the cast strapped Kent Reliance Building Society. Is this signaling the end for the principles of the good old mutual?

Posted by enuii @ 11:48 PM (1295 views)
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3 thoughts on “Building Society Succumbs to Corporate Temptation

  • the number cruncher says:

    This is very sad news – the KRBS gave me a partial grant to do an MBA 11 years ago, for which I am very grateful.

    The asset strippers at JC Flowers will wreck the long term future of KRBS for short term gain, sack any quality staff and outsource most of the job functions.

    Mutual societies are a great tradition that have delivered sustainable lending to ordinary people for nearly 150 years. One of the worst crimes thatcher ever committed was to destroy these institutions.

    We need to rediscover the advantages that Co-ops and mutuals bring to the long term stability of our country and take finance out of the hands of private international interests.

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  • @NC

    I cannot agree with your comment on Thatcher destroying these institutions, whilst Abbey National did demutualise in 1989 the majority were as follows:

    Alliance & Leicester, Halifax, Norwich Union & Northern Rock 1997. OK the wheels would have been set in motion under Major’s government but Thatcher was long gone by that time.

    Bradford & Bingley 2000, Friends Provident 2001 and Standard Life 2006 all demutualised well into the Labour years.

    However, having said that, I am a firm believer in and supporter of building socities and other mutual institutions and fully agree with your comment “We need to rediscover the advantages that Co-ops and mutuals bring to the long term stability of our country and take finance out of the hands of private international interests.”

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  • the number cruncher says:

    I think the legislation was put in by Thatcher’s administration. As these matters take a long term to unfurl the blame lies squarely on Mrs T Shoulders (admittedly as a zealot, she may have not realised the consequences of her stupidity) . Major and brown/blair never challenged the Chicago school privatisation doctrine and so could not, or did not want, to contain the genie in the bottle.

    I highly doubt Bullingdon Dave’s ‘Big Society’ will extend to the promotion of mutual financial organisations. I think he is only interested in the spuedo privatisation of state functions, which will absolve them of responsibility if things go wrong and when people start dying of neglect and incompetence.

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