Yorkshire Building Society is the UK's second largest building society with assets exceeding £30bn, while N&P is the UK's ninth largest society with assets of £3.7bn. The proposed merger will create an enlarged society with 3 million members and 224 branches.
The combined society, which will be known as Yorkshire Building Society, will be focused on the traditional building society business of residential mortgages and savings and will be principally retail funded. The N&P name will be retained as a separate and distinct brand within the Yorkshire, similar to the Chelsea and Barnsley brands.
The merger is subject to final agreement by the Boards of both societies and to certain conditions being satisfied, principally the approval of eligible members of N&P at a Special General Meeting (SGM) and confirmation by the Financial Services Authority (FSA).
The proposed merger is expected to complete on 1 November 2011.
Iain Cornish, chief executive of Yorkshire Building Society, said: "N&P has similar values to the Yorkshire. It shares our commitment to mutuality and our determination to deliver long-term value and exceptional customer service to our members.
“Its traditional building society activities remain profitable and it is well regarded in the communities it serves in the east of England.
“We will build on N&P's strong brand and the value it has delivered to its members, while gaining the opportunity to consider developing our own products in areas where N&P has complementary capabilities and expertise, such as the current account market.”
Gordon Horsfield, chairman of N&P, said: "For many years N&P has been committed to putting its customers at the heart of everything we do, and we know from all their feedback that our way of doing this is warmly and loyally welcomed.
“The Board concluded some time ago that to uphold this proposition for the longer term requires continued levels of investment in back office, branches, product pricing and range as well as to support training and development opportunities for our staff to help them keep delivering the service expected.
“The necessary resources for this continuing investment can only readily come from the economies of scale, organisational depth and financial strength associated with size. We also strongly believe that the values and culture associated with the mutual business model are the right ones for our market.
"The opportunity to merge with so highly a respected society as the Yorkshire, where these qualities are so evident, is one which is right for N&P. We particularly value their commitments to our members to maintain the branch network, their interest in and concern for our staff, and the open-mindedness and appreciation they have shown of our ideas, products and expertise where these are not presently offered by the Yorkshire, with a view to making them more widely available."
