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Risky move: national boss Debbie Crosbie
A petition calling on Nationwide to give members a say in its takeover of Virgin Money is on course to achieve the target needed to call a special meeting.
The building society, led by Debbie Crosbie, insists it is not necessary to consult the 16 million members who own the mutual about its bid for the High Street lender.
Nationwide says any consultations could delay the £2.9 billion deal.
But some members say taking Virgin Money, which will increase Nationwide’s size by a third, is risky and want the building society to explain what it means for customers.
One of them, Mikael Armstrong, says the decision not to give the owners any say in the Virgin deal is ‘a shameful display of arrogance’. There is “absolutely no guarantee” that buying Virgin would “benefit members in any way,” he adds.
Armstrong has set up a petition on the change.org website, which has so far attracted more than 400 of the 500 signatures needed to call a special meeting of the association’s members.
If the goal is achieved, he says he will “take care of the paperwork” and take the petition to Nationwide’s headquarters.
Members who sign must also pay a deposit of £50 each.
Experts say the 500 signature rule, which was introduced long before social media was invented, is a low bar. Being forced to hold a one-off meeting would be a setback for Nationwide as it could blow the Virgin deal off course.
A court hearing to approve Virgin is scheduled for April 18. If approved, the offer documents will be sent to Virgin Money shareholders – who will get a vote – by the end of this month.
Sir Richard Branson’s Virgin Group, the bank’s largest shareholder, will receive a net £400m for its 14 per cent stake, plus up to £300m in add-ons. National chairman Kevin Parry has already contacted 16 million members to outline the terms of the deal, which will see the building society enter commercial banking for the first time.
Insiders say that even if a special membership meeting is called, Nationwide’s board would oppose any vote on the Virgin deal. Crosbie suffered a setback last week when an advert starring The Crown actor Dominic West was banned for misleading customers into thinking the building society was not closing branches.
The Advertising Standards Authority received 281 complaints about the ad, including one from rival Santander, which said Nationwide had recently closed or reduced opening hours at a number of outlets.
The watchdog also found that Nationwide had not been clear enough that a pledge not to close any more branches would end in 2026. That promise has now been extended until 2028.