Nationwide is set to pay out a bonus worth at least £350million to millions of its customers as part of its “Fairer Share” scheme.
The building society launched “Fairer Share” last year after recording record profits of £2.2billion. Nationwide paid £100 to around 3.4 million members as part of the scheme - but This is Money reports that the next payout could be bigger because of higher interest rates.
Last year, Nationwide said it intends to issue annual “Fairer Share” rewards going forward, depending on its financial results. The details of any payouts are expected to be announced on Thursday. Nationwide members had to meet certain eligibility requirements to get the “Fairer Share” bonus payments last year.
For example, you had to have at least £100 in total in one or more account. It was available to mortgage, current account and savings customers. The payments were made automatically last year. Nationwide has around 16 million members.
Virgin Money shareholders are this week set to decide whether to accept a £2.9billion takeover offer from Nationwide. Virgin Money needs 75% of voting shareholders to approve the deal - but Nationwide has come under fire for not allowing its members to vote.
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If the deal is agreed, Virgin Money would initially run as a separate business within Nationwide, before then being integrated within the next six years. After this point, the Virgin Money name would no longer be used. A petition calling for Nationwide members to be given a say has reached over 5,000 signatures.
Kevin Parry, Chairman of Nationwide Building Society, said: “A combination with Virgin Money would accelerate Nationwide’s strategy and create a stronger, and more diverse, modern mutual. The combination would increase Nationwide’s scale and financial strength, put us in a stronger position to continue to provide Fairer Share Payments to eligible Nationwide members, and offer rates for mortgages and savings that are, on average, better than the market average.”
David Bennett, Virgin Money UK chairman, added: "The board of Virgin Money is pleased that Nationwide recognises the considerable strengths and opportunities that exist across our business, with the potential acquisition delivering attractive value for our shareholders. We are confident that a combination would support an exciting new chapter for Virgin Money to benefit from Nationwide's scale and ambition."
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