Mercantile members will be invited to vote on the proposal at the Society’s AGM at the end of April. The combined Society, which will be named Leeds Building Society, will have assets of almost £7 billion, with £6.7 billion from the Leeds and £0.24 billion from Mercantile.
Gordon Robinson, chief executive of the Mercantile, said: “Taking into account this maturing marketplace, with its regulatory requirements, demands for ever more sophisticated IT and greater competition, we decided that the long-term interests of our members would be best served by seeking a partner who can bring the benefits of greater size but still retain for our members all the advantages and privileges of mutuality,” he added.
Ian Ward, chief executive of Leeds Building Society, said: “Members of Leeds Building Society will see their society grow and increase its branches in the North East, and Mercantile members will benefit from a wider range of products and the real efficiencies that will be realised by the combined societies.”
Rob Clifford, managing director of Mortgageforce, said: “It’s good to see Leeds strengthening in this sector by adding the Mercantile and it’s likely to be the first of several consolidations happening over the next 12 to 18 months.”
Under the proposed merger, Ian Ward will become chief executive of the combined society while Gordon Robinson will become director for the North East.
