N&P won’t rule out merger talk

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ONE Of the city’s largest employers, Norwich and Peterborough Building Society, has refused to rule out a merger after confirming rumours of interest in the company.

The building society, which is based in Lynch Wood, Peterborough, where it employs 400 people, today said that its board was ‘continually reviewing’ all options which could benefit the society.

Last week the society confirmed it had rejected an approach from private equity firm JC Flowers to buy a stake in Norwich and Peterborough (N&P).

A spokeswoman said an approach had been made in September, but the society had rejected the offer.

But today a spokeswoman for the society said board members would continue to review any offers made if they were for the good of the firm.

She said: “Norwich & Peterborough Building Society confirms that over the last year it has received a number of expressions of interest from parties in connection with a possible merger or injection of new capital.

“Like other responsible organisations, the board continually keeps under review, with its long-standing advisers Fenchurch, all options for the Society which could enhance the interests of members, customers and employees.”

However, the spokeswoman would not confirm how many offers it had received, or where the offers had come from.

City MP Stewart Jackson said he had not heard rumours about the merger, but that the society did play an important part in Peterborough’s economy.

He said: “I have not heard anything about the rumours, and at the moment I suspect it is just speculation.

“Norwich and Peterborough are a very important part of the economy in this city in terms of jobs and financial services.

“Any takeover or merger by a bigger firm could possibly put jobs at risk here.

“If it does happen, I would hope the firm retains a very strong link with the local economy.”

John Bridge, chief executive of Peterborough Chamber of Commerce, said it was important that the building society stayed in as strong a position as possible.

He said: “What we need is a strong Norwich and Peterborough.

“The key thing is that all building societies have had key challenges throughout the financial crisis, and many of those challenges have been through no fault of their own.

“I am sure they are working towards what is best for the future of the society.”

Earlier this year N&P had come under pressure following the sale of financial products which invested in a firm called Keydata to 3,100 of its customers – 300 of who are from the city – through its independent financial advice arm.

Many who were affected are now receiving compensation from The Financial Services Compensation Scheme (FSCS) after Keydata was placed into administration in June 2009 and an investigation was launched into Keydata a month later by the Serious Fraud Office (SFO).

In October last year Norwich and Peterborough, which currently has 46 branches mainly located across the East of England, announced that it was making 36 redundancies after profits dropped from about £26 million to just £5 million in 2008.