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12 Jul 2020


‘The return of the carpetbaggers’

Rachel Thrussell, Head of Savings at moneyfacts.co.uk explains why we might be seeing the return of carpetbaggers. 

“The mid 1990s were rife with Building Society mergers and conversions, including big names such as Alliance & Leicester, Halifax and Woolwich which floated, while Cheltenham & Gloucester merged with Lloyds Bank and National & Provincial BS merged with Abbey National.

“With average windfalls in 1997 at £1,100, it is no surprise investors were keen to take a small gamble to spread their money amongst building societies which could provide significant returns, should a conversion or merger take place. The demand for building society accounts was so high, some were forced to close their branch doors or at the very least restrict account opening.

“So is this trend beginning again?

“This year building society mergers have often been in the news, the most recent, and notable being the proposed Portman BS and Nationwide merger. With most societies requiring only £100 of savings to qualify as a member, many consumers could be entitled to a windfall of at least £200.

Portman & Nationwide

Qualifying Portman members to receive at least £200 (pre-tax)

Lambeth & Portman

Qualifying Lambeth members to receive a minimum of £400

Universal & Newcastle

Qualifying Universal members to receive a minimum of £200

Leeds & Mercantile

Qualifying Mercantile members to receive a merger bonus of 8.4% of their balance, up to a max of £2.5K (min £400)

“In an attempt to prevent another onslaught from savers out to make ‘a quick buck’, otherwise known as carpetbaggers, 51 building societies have implemented a charitable assignment scheme. This may require new members to sign away any their rights to any windfall payments in the event of a merger or conversion. Those listed include Portman BS, Leeds BS and Universal BS.

“For those building societies not operating this scheme, other measures to restrict account opening are used as a deterrent. In the last month, Moneyfacts researchers have seen three building societies increase their minimum opening balances for non-locals. Could this be an early restraint to discourage investors whose only aim is to bag windfalls?

  1. Dudley BS – minimum investment for non locals is now £1K (except Mini Cash ISA/ Tessa Only ISA Transfers In)
  2. Scottish BE - minimum investment for non locals is now £1K
  3. Shepshed BS - minimum investment for non locals is now £1K


“These building societies attempting to prevent carpetbagging should receive particular praise for trying to protect their loyal members and retaining their commitment to their local communities.”


Moneyfacts Group
Moneyfacts is the UK’s leading independent provider of personal financial information and our data is used and trusted throughout the financial industry. 

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