A proposed merger between the Britannia Building Society and Co-operative Financial Services will lead to increased mortgage lending, the firms have said.
Mortgage availability will be boosted if a proposed merger between two mutuals takes place, the companies involved have claimed.
The Britannia Building Society and Co-operative Financial Services (CFS) have announced plans to create a super-mutual. Both companies said that they were active in the mortgage lending market in 2008, despite the difficulties faced by many other institutions, and added that they would be able to finance more homeowners following the merger.
Additionally, they believe that the new organisation will be more ethical when compared to shareholder-owned banks. They felt that many consumers want a change to how they deal with financial institutions following the credit crunch.
Britannia chairman Rodney Baker-Bates said: "The combined and complementary strengths of our businesses will offer customers a strong, fair and ethical alternative to banking plcs [public limited companies]. Customers will be owners and will have available all the services they would expect from a major financial provider, together with a real say in setting strategy combined with a share of the profits."
However, the move can only go ahead if a new law - the Building Societies (Funding) and Mutual Societies (Transfers) Act - is passed in March. The act - labelled the Butterfill Bill after its sponsor Sir John Butterfill - was laid out in Parliament on January 19th.
