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Britannia in merger talks with Co-operative

building societies set to join forces

Co-operative Financial Services is in merger talks with Britannia, the country’s second-largest building society.

Neville Richardson Britannia Group Chief Executive

Neville Richardson Britannia Group Chief Executive

Joining forces with Britannia, which has more than 200 branches throughout the country, will enable the Co-op, which has just over 100 branches, to take on the UK’s main retail banks.

Britannia says the move ‘is not a response to the credit crunch, as both businesses have been pursuing successful strategies and don’t need to merge.’ 

However, its profits for the first half of 2008 fell £31.2m to £50.5m, partly as a result of mounting mortgage arrears.

Britannia Group chief executive Neville Richardson said: ‘Talks are at an early stage and no decisions have been taken, so it’s too soon to talk about what changes might arise for our customers and employees.’

Britannia Building Society performed well in the latest Which? Money  mortgage satisfaction survey, ranking second behind First Direct. The Co-operative bank was ranked second behind First Direct in the Which? annual current account survey.

Which? Money editor Martyn Hocking said: ‘Both brands have gained excellent customer satisfaction scores in recent Which? Money surveys, but this move – if it goes ahead- continues a worrying trend that is reducing choice for consumers on the high street.’

For the best available products on the market go to the Which? free advice guide for Savings and Accounts & mortgage reviews

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