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Nationwide takes over Dunfermline | Nationwide takes over Dunfermline |
(10 minutes later) | |
The Nationwide has been confirmed as the buyer of the Dunfermline Building Society's branches, good loans and deposits. | The Nationwide has been confirmed as the buyer of the Dunfermline Building Society's branches, good loans and deposits. |
The mutual was put up for sale after incurring losses of £26m. | The mutual was put up for sale after incurring losses of £26m. |
The Nationwide will also take on Dunfermline's 530 staff, according to the BBC's business editor Robert Peston. | The Nationwide will also take on Dunfermline's 530 staff, according to the BBC's business editor Robert Peston. |
The Treasury will take over £1bn of commercial property lending and acquired portfolios of mortgages. | The Treasury will take over £1bn of commercial property lending and acquired portfolios of mortgages. |
The deal with the Nationwide has emerged less than 48 hours after the UK Government announced that the building society was to be put on the market. | The deal with the Nationwide has emerged less than 48 hours after the UK Government announced that the building society was to be put on the market. |
Robert Peston said Britain's largest building society was the natural buyer of the good parts of the Dunfermline and that it has a strong track record of absorbing weaker societies. | Robert Peston said Britain's largest building society was the natural buyer of the good parts of the Dunfermline and that it has a strong track record of absorbing weaker societies. |
He said the deal would also preserve the brand name of the society. There are still Cheshire and Derbyshire branches, even though these two societies have recently been bought by Nationwide. | He said the deal would also preserve the brand name of the society. There are still Cheshire and Derbyshire branches, even though these two societies have recently been bought by Nationwide. |
Chancellor Alistair Darling had said the Dunfermline would have needed between £60m and £100m to keep it going because of its exposure to risky assets. | |
But the Treasury ruled out a full government bailout after regulators said the move was not sustainable. | |
'Good news' | 'Good news' |
However, the Dunfermline's outgoing chairman, Jim Faulds, had claimed government funding of £20m-£30m would have helped secure its future and dismissed claims the building society had debts linked to the toxic US sub-prime mortgage market. | However, the Dunfermline's outgoing chairman, Jim Faulds, had claimed government funding of £20m-£30m would have helped secure its future and dismissed claims the building society had debts linked to the toxic US sub-prime mortgage market. |
The Scottish Government had offered money to help keep the Dunfermline going, but did not get Treasury approval for the move. | The Scottish Government had offered money to help keep the Dunfermline going, but did not get Treasury approval for the move. |
First Minister Alex Salmond has expressed disappointment that the building society could not continue as a going concern. | First Minister Alex Salmond has expressed disappointment that the building society could not continue as a going concern. |
The Dunfermline was founded in the Fife town from which it takes its name in 1869, and has 34 branches. | The Dunfermline was founded in the Fife town from which it takes its name in 1869, and has 34 branches. |
A protest at the sale is planned in the town on Monday morning. | A protest at the sale is planned in the town on Monday morning. |
However, the local MP, Liberal Democrat William Rennie, welcomed the takeover. | However, the local MP, Liberal Democrat William Rennie, welcomed the takeover. |
"I think it's good news that the jobs have been secured within the Dunfermline Building Society as part of the Nationwide deal," he said. | "I think it's good news that the jobs have been secured within the Dunfermline Building Society as part of the Nationwide deal," he said. |
"Employees must have been thinking over the weekend about their jobs and future, it's a traumatic experience." | "Employees must have been thinking over the weekend about their jobs and future, it's a traumatic experience." |