Portman Building Society
Encyclopedia
The Portman Building Society was a UK
mutual
building society
, providing mortgages
and savings account
s to UK consumers and offering loans to commercial enterprises. Its head office was located in Bournemouth
and its administration centre in Wolverhampton
. Portman merged with the Nationwide Building Society
in August 2007, at which time it was the third largest building society in the UK and the largest regional building society in the south of England
, with 154 branches and assets exceeding £15 billion.
A protest group against the merger was created, citing loss of jobs, customer service and members' interests as reasons that the merger should not go ahead. The campaign attracted significant media attention. Bournemouth Counciller Ron Whittaker, himself a Portman account holder, appealled to Portman members to vote against the merger and "not to be taken in by handouts", in reference to the windfall offered. Financial observers questioned the benefits of a merger (describing it as more akin to a takeover) citing issues such as job losses, less competitive rates and lower service standards as disadvantages.
Just months prior to the announcement of merger plans, Portman executive directors had argued that the interests of Portman members would be best served by it remaining an independent mutual building society. As part of the merger tender presented by Nationwide, Portman executive directors were offered the incentive of higher paid jobs on the board of the Nationwide should the planned merger take place. Portman executive directors had further personal interest in the merger being approved as a large portion of their bonuses were dependant on the merger being completed, a fact that was omitted from the merger booklet provided to Portman members and not disclosed until after the merger votes had been submitted. Merger information presented to voters suggested that they should vote in favour of the proposed merger, advice in direct contrast to that expressed by the same Portman board before they had received Nationwide's incentive-laden offer.
The merger was overwhelmingly endorsed by members at the society's AGM on 23 April 2007. After the Financial Services Authority
(FSA) endorsed the members' decision on 26 July 2007, the society became part of the Nationwide on 28 August 2007. After successfully convincing Portman members to vote in favour of the proposed merger, Portman Chief Executive Robert Sharpe received a golden handshake
of £1.7m and a pension worth £152,000 per year, in addition to the salary received from his new position as Chief Executive of West Bromwich Building Society. As a direct result of the merger approximately 900 people lost their jobs.
United Kingdom
The United Kingdom of Great Britain and Northern IrelandIn the United Kingdom and Dependencies, other languages have been officially recognised as legitimate autochthonous languages under the European Charter for Regional or Minority Languages...
mutual
Mutual organization
A mutual, mutual organization, or mutual society is an organization based on the principle of mutuality. Unlike a true cooperative, members usually do not contribute to the capital of the company by direct investment, but derive their right to profits and votes through their customer relationship...
building society
Building society
A building society is a financial institution owned by its members as a mutual organization. Building societies offer banking and related financial services, especially mortgage lending. These institutions are found in the United Kingdom and several other countries.The term "building society"...
, providing mortgages
Mortgage loan
A mortgage loan is a loan secured by real property through the use of a mortgage note which evidences the existence of the loan and the encumbrance of that realty through the granting of a mortgage which secures the loan...
and savings account
Savings account
Savings accounts are accounts maintained by retail financial institutions that pay interest but cannot be used directly as money . These accounts let customers set aside a portion of their liquid assets while earning a monetary return...
s to UK consumers and offering loans to commercial enterprises. Its head office was located in Bournemouth
Bournemouth
Bournemouth is a large coastal resort town in the ceremonial county of Dorset, England. According to the 2001 Census the town has a population of 163,444, making it the largest settlement in Dorset. It is also the largest settlement between Southampton and Plymouth...
and its administration centre in Wolverhampton
Wolverhampton
Wolverhampton is a city and metropolitan borough in the West Midlands, England. For Eurostat purposes Walsall and Wolverhampton is a NUTS 3 region and is one of five boroughs or unitary districts that comprise the "West Midlands" NUTS 2 region...
. Portman merged with the Nationwide Building Society
Nationwide Building Society
Nationwide Building Society is a British building society, and is the largest in the world. It has its headquarters in Swindon, England, and maintains significant administration centres in Bournemouth and Northampton...
in August 2007, at which time it was the third largest building society in the UK and the largest regional building society in the south of England
England
England is a country that is part of the United Kingdom. It shares land borders with Scotland to the north and Wales to the west; the Irish Sea is to the north west, the Celtic Sea to the south west, with the North Sea to the east and the English Channel to the south separating it from continental...
, with 154 branches and assets exceeding £15 billion.
History
- 1846 Provident Union Building Society is established in Ramsbury, WiltshireWiltshireWiltshire is a ceremonial county in South West England. It is landlocked and borders the counties of Dorset, Somerset, Hampshire, Gloucestershire, Oxfordshire and Berkshire. It contains the unitary authority of Swindon and covers...
. - 1881 Portman Chapel TemperanceTemperance movementA temperance movement is a social movement urging reduced use of alcoholic beverages. Temperance movements may criticize excessive alcohol use, promote complete abstinence , or pressure the government to enact anti-alcohol legislation or complete prohibition of alcohol.-Temperance movement by...
Permanent Benefit Building Society is founded in LondonLondonLondon is the capital city of :England and the :United Kingdom, the largest metropolitan area in the United Kingdom, and the largest urban zone in the European Union by most measures. Located on the River Thames, London has been a major settlement for two millennia, its history going back to its...
. - 1989 Portman merges with the Wessex Building Society.
- 1990 The Portman Wessex Building Society merges with the Regency & West of England Building Society to form Portman Building Society.
- 1993 Portman merges with the St. Pancras Building Society.
- 1997 Portman merges with the Greenwich Building Society.
- 2001 Portman acquires Sun Bank, a specialist mortgage lender.
- 2003 Portman merges with Staffordshire Building Society, and both are re-branded.
- 2004 Sun Bank changes its name to The Mortgage Works.
- 2006 Portman merges with Lambeth Building SocietyLambeth Building SocietyThe Lambeth Building Society was a UK building society. It was founded in February 1852 as The Number Three Borough of Lambeth Permanent Benefit Building Society ....
. - 2006 Portman and Nationwide Building SocietyNationwide Building SocietyNationwide Building Society is a British building society, and is the largest in the world. It has its headquarters in Swindon, England, and maintains significant administration centres in Bournemouth and Northampton...
announce their merger intentions. - 2007 Portman and Nationwide complete their merger, with Nationwide the successor entity.
Merger
On 12 September 2006, the society announced plans to merge with the Nationwide Building Society, creating a mutual body with assets of more than £150 billion.A protest group against the merger was created, citing loss of jobs, customer service and members' interests as reasons that the merger should not go ahead. The campaign attracted significant media attention. Bournemouth Counciller Ron Whittaker, himself a Portman account holder, appealled to Portman members to vote against the merger and "not to be taken in by handouts", in reference to the windfall offered. Financial observers questioned the benefits of a merger (describing it as more akin to a takeover) citing issues such as job losses, less competitive rates and lower service standards as disadvantages.
Just months prior to the announcement of merger plans, Portman executive directors had argued that the interests of Portman members would be best served by it remaining an independent mutual building society. As part of the merger tender presented by Nationwide, Portman executive directors were offered the incentive of higher paid jobs on the board of the Nationwide should the planned merger take place. Portman executive directors had further personal interest in the merger being approved as a large portion of their bonuses were dependant on the merger being completed, a fact that was omitted from the merger booklet provided to Portman members and not disclosed until after the merger votes had been submitted. Merger information presented to voters suggested that they should vote in favour of the proposed merger, advice in direct contrast to that expressed by the same Portman board before they had received Nationwide's incentive-laden offer.
The merger was overwhelmingly endorsed by members at the society's AGM on 23 April 2007. After the Financial Services Authority
Financial Services Authority
The Financial Services Authority is a quasi-judicial body responsible for the regulation of the financial services industry in the United Kingdom. Its board is appointed by the Treasury and the organisation is structured as a company limited by guarantee and owned by the UK government. Its main...
(FSA) endorsed the members' decision on 26 July 2007, the society became part of the Nationwide on 28 August 2007. After successfully convincing Portman members to vote in favour of the proposed merger, Portman Chief Executive Robert Sharpe received a golden handshake
Golden handshake
A golden handshake is a clause in an executive employment contract that provides the executive with a significant severance package in the case that the executive loses his or her job through firing, restructuring, or even scheduled retirement...
of £1.7m and a pension worth £152,000 per year, in addition to the salary received from his new position as Chief Executive of West Bromwich Building Society. As a direct result of the merger approximately 900 people lost their jobs.