BSA welcomes parliamentary debate on building societies and FSCS levies

BSA welcomes parliamentary debate on building societies and FSCS levies

BSA welcomes parliamentary debate on building societies and FSCS levies

Building societies are having to pay too much of the cost of compensation for Bradford and Bingley and other failed banks. A Parliamentary debate tomorrow will highlight this.

The Westminster Hall debate, to be introduced by Ann Cryer, Labour MP for Keighley, follows a Parliamentary Early Day Motion that has quickly gained the support of 159 MPs.

Commenting ahead of the debate, Adrian Coles, Director-General of the BSA, said:
“Building societies feel very strongly that they are footing a disproportionately high share of the bill for the failed banks.
Societies have higher levels of retail funding than banks and are not profit maximising, so the levies hit them harder than their plc counterparts. This debate, along with the Early Day Motion Ann has tabled, shows that many MPs feel the same.”

Ann Cryer, Labour MP for Keighley, said “It’s hugely unfair that building societies are paying for bank failures. As mutual, member-owned organisations, any additional costs, such as the FSCS levies, ultimately hurt societies’ members – their savers and borrowers.

“My Early Day Motion has gained huge support so far and I hope this debate persuades the Government that FSCS levies need to be modified to better reflect the relative risk profiles of building societies and banks.”

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Notes to Editors

1. The Westminster Hall debate will take place from 11.00am – 12.30pm on Tuesday 10 March. It can be watched live on Parliament TV here www.parliamentlive.tv Click What’s On and select Westminster Hall on Tuesday.

2. Early Day Motion 426 – Financial Services Compensation Scheme Levy on Building Societies – can be viewed here
http://edmi.parliament.uk/EDMi/EDMDetails.aspx?EDMID=37446&SESSION=899

3. The Building Societies Association (BSA) represents all 55 building societies in the United Kingdom. Building societies have total assets of
£395 billion and, together with their subsidiaries, hold residential mortgages of £250 billion, more than 20% of the total outstanding in the UK. Societies hold over £235 billion of retail deposits, accounting for more than 20% of all such deposits in the UK. Building societies also account for about 37% of all cash ISA balances. Building societies employ over 51,500 full and part-time staff and operate through more than 2,000 branches.