With competition for market share and business intensifying, building societies are having to shift their attention away from competing with fellow societies towards holding their own against a wave of new entrants and established plc brands.
Paul Marland, AGM intermediary sales at West Brom for Intermediaries, commented: “We may be a building society in origin but we find we are operating more like a plc. Our branch network is very important to us but, on the broker side, we have to operate in a much more commercial environment. With our buy-to-let business, we don’t see other building societies as our competitors but the likes of GMAC-RFC and edeus.”
His sentiments were echoed by Alison Rolls, AGM communications at Norwich & Peterborough BS.
However, Rolls believed the mutuality of societies gave them a competitive edge over plc lenders.
“When you are dealing with intermediaries, it is not about your corporate governance. We are building societies but when we are dealing with brokers we know our strategy has to be about delivering the right product and the service which brokers demand. Whether you are a bank or building society is irrelevant but I think societies are geared towards a more personal service.”
Neil Johnson, head of PR and policy at the Building Societies Association, said:
“Customers aren’t as loyal to societies any more. Also, with the advent of best-buy tables, it makes it very easy to compare products and companies. This thinking is indicative of how the market is going but societies have the business model in place to compete.”
