Norwich and Peterborough to repay £57m to Keydata investors

| March 23, 2011 | 0 Comments

The Norwich and Peterborough Building Society (N&P) is to repay £57 million in compensation to customers who were sold its Keydata product.

N&P sold Keydata products from 2005 but it was placed into administration in 2009, with 30,000 UK investors facing the loss of £450 million.

The collapse of Keydata represents the largest investment failure the Financial Services Compensation Scheme (FSCS) has dealt with.

Chairman Gordon Horsfield comments: “The society has been deeply concerned for its customers who have suffered following Keydata’s failure and is very sorry for the hardship and anxiety that has occurred.”

The £57 million compensation bill is more than 10 times the pre-tax profit of £5.1 million the mutual made in 2010 and could, therefore, threaten its future.

However, it emerged over the weekend that N&P is in talks with larger rival Yorkshire Building Society which could lead to an acquisition.

The announcement comes after much consolidation in Britain’s mutual sector, as a result of funding pressures.

N&P is Britain’s tenth largest society.

Tags: Financial Services Compensation Scheme, , Keydata, , Norwich and Peterborough Building Society,

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