Nationwide, Britain’s biggest building society, has come under fire for failing to provide better return rates than high street banks to their savers. This is despite executives in the company receiving annual salaries of as much as £2 million.
The Nationwide chairman, Geoffrey Howe, stated that “benefits are heavily skewed in favour of borrowers” when asked to address the concerns of savers at the building society’s annual meeting in Manchester. However, many were quick to point out that the bank’s savers outnumber borrowers by almost ten to one, which makes them question why borrowers are receiving the better deals.
At the same meeting, it was also announced that Chief Executive Graham Beale would see the total of what he earns this year reach over £2.25 million.
There was plenty of anger directed at the board during the meeting. John Dawson, a factory worker on a £12,000 a year salary told them “You and your boardroom colleagues are using the society to line your pockets. You are not putting savers first, even though it is our money” and was greeted with widespread applause throughout the audience.
This comes at an inopportune time for the building society; many customers had been moving across to Nationwide in recent weeks as the seemingly unending wave of bad news about the main high street banks continued. Now, with details emerging of the executive pay packets at Nationwide, new customers will be wondering if they have simply jumped out of the frying pan and into the fire.
With the number of people creating new current accounts with Nationwide up 67% since early June, the building society will be keen to address these issues and restore confidence in their services. They can not afford to be tarred with the same brush that has hit high street banks in recent weeks.