The Boards of Yorkshire Building Society and Chelsea Building Society announced that they have agreed to merge, creating a second major force in the building society sector.
The enlarged Society will have assets of £35bn, providing a competitive and secure alternative to the retail banks. With 2.7m members and a national network of 178 branches, the merged Society will focus on the traditional building society business of residential mortgages and savings and will be principally retail funded. The enlarged Society will be known as Yorkshire Building Society with the Chelsea Building Society name retained and operated as a separate and distinct brand within the Yorkshire. The merger is subject to the approval of eligible members from both societies and confirmation by the FSA; it is expected to complete on 1st April 2010.
The Chief Executive of the enlarged Society will be Iain Cornish, currently Chief Executive of Yorkshire Building Society. Ed Anderson, Yorkshire Building Society Chairman will remain as Chairman. Stuart Bernau, Executive Chairman of Chelsea Building Society, who has led the strategic review of Chelsea, will relinquish his Board position immediately prior to the merger becoming effective.
Iain Cornish, Chief Executive of Yorkshire Building Society said: “This merger creates a second major force in the building society sector. Joining with Chelsea offers a great opportunity to build on the strengths of both societies and form a strong, independent mutual organisation.
“Chelsea has an excellent reputation, particularly in the savings market, and a strong network of branches in the south. Combining forces with them will strengthen our ability to deliver value to members through good value products and excellent service, underpinned by our significant financial strength. Together our combined expertise will deliver a competitive, member-owned organisation, which will provide real choice to consumers across the UK.
“The enlarged Society will continue to have one of the strongest capital positions of any major UK bank or building society and a secure funding base. As far as Yorkshire is concerned, we are seeing more positive signs and this merger will ensure that we are extremely well placed to prosper as markets recover. I firmly believe that a merger with Chelsea on these terms is in our members' interests and urge them to vote in favour of it”.