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‘Pathetic’ Portman merger bonus attracts brickbats

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11/04/2007

Members of Portman Building Society are furious at the ‘pathetic’ £200 merger bonus they will receive when the society is absorbed into Nationwide later this year.

Many observers pointed out that this windfall bonus undervalues the Portman, which announced record profits of £93m last year and saw its assets increase by 20% to £21bn.

The bonus is worked out as 5.75% of a saver’s total balances with the society, with a minimum payment of £200 and a maximum of £1,000 to be paid out when the merger completes. This means that a saver with £5,000 with the society will get £287.50 if the deal goes ahead.

“This is absolutely pathetic,” says saver Maureen Smith, who has had a savings account with the society for over seven years. “When Portman bought Lambeth Building Society last year, the Lambeth members got windfalls of £400 each.”

But Portman’s directors countered this criticism and said that it cannot pay higher windfalls as it has a larger member base compared with other societies, meaning it has a lower reserves-to-member ratio.

“This is just nonsense designed to baffle ordinary savers,” said Smith. “I will be looking to compare savings accounts in the near future and will switch provider once this deal has gone through. We have been treated very poorly.”

 

 

 

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