This article is from the source 'bbc' and was first published or seen on . It will not be checked again for changes.
You can find the current article at its original source at http://news.bbc.co.uk/go/rss/-/1/hi/scotland/7958497.stm
The article has changed 5 times. There is an RSS feed of changes available.
| Version 2 | Version 3 |
|---|---|
| Building society in crunch talks | Building society in crunch talks |
| (30 minutes later) | |
| Scotland's biggest building society remains in intensive talks with the financial regulator over its future. | |
| It emerged at the end of last week that the Dunfermline Building Society was in serious trouble and facing multi-million pound losses. | It emerged at the end of last week that the Dunfermline Building Society was in serious trouble and facing multi-million pound losses. |
| The society, which has 34 branches across the country and almost 500 employees, was founded 140 years ago. | The society, which has 34 branches across the country and almost 500 employees, was founded 140 years ago. |
| It made £2m profit in 2007 but it is now understood that the mutual is having problems with its cash flow. | It made £2m profit in 2007 but it is now understood that the mutual is having problems with its cash flow. |
| There has been speculation that it could announce losses of up to £26m. | There has been speculation that it could announce losses of up to £26m. |
| BBC Scotland business editor Douglas Fraser said the main players had been unwilling to talk about the situation, which had led to a great deal of speculation. | BBC Scotland business editor Douglas Fraser said the main players had been unwilling to talk about the situation, which had led to a great deal of speculation. |
| "Indeed the building society seems unwilling to protect its own reputation amid this speculation," he said. | "Indeed the building society seems unwilling to protect its own reputation amid this speculation," he said. |
| "It is fairly clear it is facing a multi-million pound loss, the lowest estimate reported is £26m. | "It is fairly clear it is facing a multi-million pound loss, the lowest estimate reported is £26m. |
| "We are told that concerns were raised months ago." | "We are told that concerns were raised months ago." |
| We will continue to look after our members' best interests and it's very much business as usual Dunfermline Building Society statement He said the building society needed an injection of capital. | We will continue to look after our members' best interests and it's very much business as usual Dunfermline Building Society statement He said the building society needed an injection of capital. |
| "The problem here is that the regulator, the Financial Services Authority, requires any financial institution that is lending to have a certain base of capital in order to match the liabilities that are out there. | "The problem here is that the regulator, the Financial Services Authority, requires any financial institution that is lending to have a certain base of capital in order to match the liabilities that are out there. |
| "Building society capital is made up through profits, if it is making a loss instead then that balance gets out of kilter and the regulator steps in." | "Building society capital is made up through profits, if it is making a loss instead then that balance gets out of kilter and the regulator steps in." |
| He added: "I think it is important to point out that a building society does not operate in the same way that a bank or another company does. | He added: "I think it is important to point out that a building society does not operate in the same way that a bank or another company does. |
| "It does not have shares, there is no collapse of the share price here, there are no hostile bids coming in - it is primarily pressure from the financial regulator to get its books sorted out." | "It does not have shares, there is no collapse of the share price here, there are no hostile bids coming in - it is primarily pressure from the financial regulator to get its books sorted out." |
| He said recent takeovers at smaller building societies in England had left the big players, the Britannia, the Nationwide, the Yorkshire building societies, "risk averse" and not keen on further mergers. | He said recent takeovers at smaller building societies in England had left the big players, the Britannia, the Nationwide, the Yorkshire building societies, "risk averse" and not keen on further mergers. |
| Both Scottish Secretary Jim Murphy and the Deputy First Minister Nicola Sturgeon have pledged that their administrations will do whatever they can to help the Dunfermline building society. | Both Scottish Secretary Jim Murphy and the Deputy First Minister Nicola Sturgeon have pledged that their administrations will do whatever they can to help the Dunfermline building society. |
| It is understood the Scottish Government has discussed the provision of about £25m to back the Dunfermline's involvement in social housing, which is a devolved responsibility. | It is understood the Scottish Government has discussed the provision of about £25m to back the Dunfermline's involvement in social housing, which is a devolved responsibility. |
| In a statement, the building society said "It is not our policy to comment on rumour or speculation. | In a statement, the building society said "It is not our policy to comment on rumour or speculation. |
| "We will continue to look after our members' best interests and it's very much business as usual." | "We will continue to look after our members' best interests and it's very much business as usual." |