The Chief Executive Officer of Skipton Building Society, David Cutler, has pleaded for the government to ensure that building societies have a level playing field on which to compete for UK saver’s funds.
Mr Cutler was pointing out that as UK savers look for the safest place in which to store their funds, the building societies are finding themselves competiting with state-owned banks consistently.
“Her Majesty’s Government is becoming our biggest competitor,” Cutler said. “If they’re going to start growing Northern Rock again they will want to attract more retail savings. My plea is that we’re given a level playing field.”
All mortgage lenders require funds from UK savers in order to lend out on mortgages. New interest rate cuts already mean that it is difficult to attract savers to deposit their funds, putting great pressure on building societies.
State owned banks, such as Northern Rock, were initially withdrawn from the mortgage lending market, however, following the government announcement that Northern Rock is to increase its mortgage lending by £14 billion over the next two years, the bank will be looking to increase its savings to fund this.