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Coventry and Stroud confirm merger deal

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by Kay Mitchell

Earlier this month, it was reported that Coventry Building Society was in merger talks with its smaller rival, the Stroud & Swindon.

Today, however, the talks have been confirmed and the merger will bring together the country’s third and eleventh largest building societies.

The merger, which is subject to approval by the members of Stroud & Swindon and confirmation by the Financial Services Authority, will create a business with approximately 1.5 million customers and assets of more than £20 billion.

Commenting on the deal, David Stewart, chief executive of Coventry Building Society, said: “Coventry’s performance over the last three years has demonstrated the strength of our traditional building society model.

“I believe that the merger with Stroud & Swindon building society will help us build on recent successes and bring the benefits of our prudent and member-focused approach to a wider membership,” added Mr Stewart.

The news comes as Coventry announced last month that its profits doubled to £56.2 million in 2009. As a result of its strong capital position, it has maintained its A credit rating.

Meanwhile, John Sutherland, chief executive of Stroud & Swindon Building Society, said: “Today’s announcement is excellent news for Stroud & Swindon members who have the opportunity to join one of the UK’s strongest and most profitable building societies.”

The deal follows a series of recent mergers between Britain’s building societies and brings further consolidation to the mutual sector.

In February, it was revealed that Skipton Building Society was merging with loss-making rival Chesham.

Meanwhile, earlier this year, Yorkshire Building Society members voted in favour of a merger with Chelsea Building Society.

Scotland’s Dunfermline Building Society was hastily taken over by Nationwide a year ago, while Cheshire and Derbyshire building societies have been swallowed up by the Nationwide.

Last year, Britannia Building Society merged with Co-operative Financial Services and in June 2009, West Bromwich Building Society agreed a deal that saw the 160-year-old institution saved from collapse.

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News posted: March 23, 2010

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