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Last Updated: Tuesday, 28 August 2007, 09:33 GMT 10:33 UK
Nationwide swallows rival Portman
Portman branch
The Portman name has now disappeared from branch offices
The Nationwide, the UK's largest building society, has become even bigger after completing its takeover of rival the Portman.

The deal was first announced nearly a year ago and was approved in a ballot of Portman members in April.

They will receive windfalls of between 200 and 1,000 each.

More than 100 branches will shut in areas where they overlap, and about 900 jobs will go when some branches and offices are closed.

The enlarged society becomes the UK's second biggest mortgage provider after the Halifax and ahead of the Abbey.

The Nationwide's group retail director, Stuart Bernau, said his customers would benefit from the merger.

"Because we haven't got any shareholders - we've only got our members - we do everything we can to offer better average savings rates and cheaper mortgage rates," he said.

"As a large organisation, and being more efficient, we will be looking to do exactly the same thing," he added.

Market concentration

The enlarged society will have about 13 million members, with the 1.2 million who are joining from the Portman receiving the windfalls.

The deal represents a further concentration of power in what is left of the building society movement.

Nearly all the big societies converted to become banks - or were bought by banks - in a swathe of demutualization's during the 1990s, a process that had been pioneered by the conversion of the Abbey National in 1989.

Earlier last year the Portman, then the UK's third largest society, took over the smaller Lambeth building society with the latter's 70,000 members receiving windfalls of at least 400 each.

There were 151 building societies 20 years ago but now there are just 59, with the Nationwide being far and away the largest.

Merger bonuses for former Portman members will be paid from 17 September.

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