# Confirmed - Nationwide UK (Ireland) to Shut Down



## Lightning (8 Apr 2017)

According to The Times article here (paywall, free reg required to read) Nationwide UK (Ireland) is set to shut down.

- 14,000 customers effected.
- Official notification will occur on 25 April 2017.
- As good as confirmed: "Following a thorough review, the society is proposing to close its Nationwide UK Ireland operation as it focuses on its core purpose of building society, nationwide. This was not an easy decision and our priority now is to the employees and customers of Nationwide UK Ireland who we will keep fully informed."

Open questions:
- What happens to those that have term deposits that have not yet matured?
- When and how will deposit holders be compensated?

The reason why Nationwide UK (Ireland) had an Irish base was always puzzling. The original reason was apparently to get access to cheap ECB funding but Nationwide UK no longer needs this funding.

One would expect that deposits would be paid back in full, even those over the deposit insurance level. Nationwide UK (Ireland) should urgently release a statement confirming this.

The decision does not bode well for the future of other small deposit operators like Investec, Leeds and Rabo.

Nationwide UK (Ireland) joins a long list of deposit taker brands that have disappeared since 2008:
- Nationwide Building Society
- Northern Rock (Ireland)
- First Active
- Anglo Irish / IRBC
- Halifax / Bank of Scotland Ireland
- National Irish Bank / Danske
- PostBank
- ACCBank
- ICS

I will remove Nationwide UK (Ireland) from the best buys.


----------



## Sarenco (8 Apr 2017)

CiaranT said:


> One would expect that deposits would be paid back in full, even those over the deposit insurance level. Nationwide UK (Ireland) should urgently release a statement confirming this.



This is obviously bad news Ciaran but I don't think customers should be concerned about the security of their deposits.  

Nationwide's Irish operation is simply a branch of the UK building society and there is no suggestion that Nationwide is in financial difficulty.


----------



## Lightning (8 Apr 2017)

Agreed. My point is simply that Nationwide UK (Ireland) should promptly issue a press release confirming that all deposit holders will be reimbursed.


----------



## skrooge (8 Apr 2017)

CiaranT said:


> Agreed. My point is simply that Nationwide UK (Ireland) should promptly issue a press release confirming that all deposit holders will be reimbursed.





What is the difference between NWUK closing the few branches they have and UL closing a couple of its branches? NWUK-IE doesnt exist its merely a trading name of the UK nationwide.  Closing a couple of offices may inconvenience some customers but their money was effectively held in the UK anyway.  I imagine people will be encouraged to get their money now before NWUK close their branches but for those that don't (or perhaps those with term deposits) the money will move to the UK and they can get a cheque through the post.   Of course you can expect Nationwide to 'incentivise' customers by dropping their rates like a stone.   It could easily turn into a leeds building society which I see is still listed in the best buys section


----------



## Lightning (8 Apr 2017)

skrooge said:


> I imagine people will be encouraged to get their money now before NWUK close their branches but for those that don't (or perhaps those with term deposits) the money will move to the UK and they can get a cheque through the post



Variable rates will probably drop to zero. Penalty free exits from term deposits and perhaps maturity interest paid early may also occur. 



skrooge said:


> It could easily turn into a leeds building society which I see is still listed in the best buys section



Are you suggesting the same thing could occur at Leeds Building Society (Ireland)? Leeds have described their Irish operation as "legacy" and are certainly not here for the long run but winding down their mortgage business may take some time yet.


----------



## skrooge (8 Apr 2017)

I dont bank with Leeds Building Society (Ireland)but I presume they just have a phone number that redirects to the UK.  NWUK could offer the same service.  The cost savings will be made from closing their offices here, the account management function could be handled in the UK.  14,000 Irish customers is a drop in the ocean, they opened 570,000 new current accounts in the UK in the first 9 months of 2016.  At best their might be penalty free withdrawals but I would imagine they will just manage them threw the remaining term.  Compare the NWUK-IE rates with [broken link removed]and the we look like a cheap source of funding for the building society. So they may not be overly proactive in shedding Irish customers.

If you think that they will pay out early on term deposits surely they should be front and center on the best buys?


----------



## Lightning (8 Apr 2017)

skrooge said:


> I dont bank with Leeds Building Society (Ireland)but I presume they just have a phone number that redirects to the UK.



Leeds Building Society (Ireland) have an Irish number that is answered locally. Leeds have an Irish presence because they are winding down their boom time mortgage business here rather than selling the mortgages to funds. Leeds are not here for a cheap source of funding.



skrooge said:


> Compare the NWUK-IE rates with [broken link removed]and the we look like a cheap source of funding for the building society



Euro funding costs rather cannot be directly compared to Sterling funding costs. Nationwide UK use Sterling funding for UK mortgages etc. Meanwhile it is plausible that some of Nationwide UK (Ireland) Euro deposits is ending up parked at the ECB costing them -0.40%.


----------



## skrooge (8 Apr 2017)

Leeds got themselves into the mess that was Irish mortgages offsetting the fx risk with some cheap deposits make sense.  But from your own best  buys its clear they keep costs to a minimum.  They have no branches, cheque in the post seems to be the only means of withdrawal. 

Matching deposits is one way of dealing with the FX risks, there are other method - especially in the short-term.  Besides if it was an issue for NWUK they would have left long ago. If you could separate out the IE element of NWUK I doubt you would find much in the way of euro denominated assets.  So closure of branch network changes nothing in that regard. 

Straight fromheir annual account: "No segmental analysis is presented on geographical lines as substantially all of the Group’s activities are in the United Kingdom, with *limited *deposit taking operations in the Isle of Man and the Republic of Ireland".

NWUK  operate here under EU passporting legislation.  With Brexit now 2 years down the line and (from a quick look at NWUK-IE website) their longest dated deposit products being 24 months it makes sense that it has happened now.    To me this points to an orderly withdrawal with the UK operations managing the limited euro deposit book.So it means little scope for any "deals" .... but I'd glady take one if they are handing out free money!!


----------



## Lightning (8 Apr 2017)

skrooge said:


> If you think that they will pay out early on term deposits surely they should be front and center on the best buys?



Nationwide UK (Ireland) could:
- Wind down their term deposit base over the next 2 years until all term deposits mature or
- Pay maturity interest now and close all accounts or
- Find some way to exit the term deposits before maturity without paying maturity interest. (Surely, not allowed?)

I don't know what they are going to do but if they pay maturity interest up front (which might be the cheapest thing for them to do to avoid 2 years of wind down costs) then term deposit holders are in for an early windfall.

Logically Nationwide UK (Ireland) would close new deposit openings immediately but their website still advertises new account openings.



skrooge said:


> NWUK operate here under EU passporting legislation



Exactly, Brexit is causing banks to relocate here but it can also cause the opposite. Nationwide UK (Ireland), Leeds Building Society (Ireland) and Investec operate under passporting rules which may end under under 2 years. They all have 2 options which are to either shut their operations here or find another way / legal structure to operate here. The costs of creating a new legal structure for such a small operation surely outweigh the benefits. Leeds Building Society (Ireland) and Investec (deposit wing only) have limited time to make decisions about the future of their Irish operations too.


----------



## skrooge (8 Apr 2017)

CiaranT said:


> Nationwide UK (Ireland) could:
> - Wind down their term deposit base over the next 2 years until all term deposits mature or
> - Pay maturity interest now and close all accounts or
> - Find some way to exit the term deposits before maturity without paying maturity interest. (Surely, not allowed?)
> ...



Given our discussion I would have thought a warning in the best buys thread highlighting the uncertainty surrounding NWUKs future here would have been sufficient.  After all some might see the potential windfall as a a reason to take a punt on them.  Besides in our made up 2 year timeframe demand/notice and regular savers accounts would all mature normally. though I appreciate the 2 year horizon is us guessing.   I know there are generally cooling off period when opening an account I wonder do they work both ways i.e., if we all go all in on 2 year NWUK accounts expecting golden handshake can they cancel the accounts in the same way as I can have a change of heart? 

As for early interest payment I doubt it will be maturity interest more whats accumulated to date.

Another option we haven't mentioned is they might sell the deposit base.  This is probably less of an option given most Irish banks have bulked up their deposits/shrunk their assets to leave themselves in a good funding position.  There's always Leeds BS I guess!


----------



## Lightning (8 Apr 2017)

skrooge said:


> Given our discussion I would have thought a warning in the best buys thread highlighting the uncertainty surrounding NWUKs future here would have been sufficient.



No value leaving the regular saver account product, notice product and instant access product listed. No point anyone opening a new account with these products. Rate will probably drop to zero shortly before deposits are refunded.

The early payout of the term deposits is speculative.



skrooge said:


> though I appreciate the 2 year horizon is us guessing



Given that the longest term deposit duration is 2 years, it would take 2 years to wind down the term deposits if Nationwide UK hold the deposits until maturity.



skrooge said:


> Another option we haven't mentioned is they might sell the deposit base.



True but I would be surprised if it happens. BoI, AIB and Ulster bank have too much deposits by some measures. Hard to see PTSB or KBC acquire the deposits but perhaps they could. PTSB did acquire Northern Rock and Nationwide Building Society deposits when they closed but PTSB has a much healthier loan to deposit ratio these days.



skrooge said:


> As for early interest payment I doubt it will be maturity interest more whats accumulated to date.



Can Nationwide UK (Ireland) who guaranteed a fixed rate for up to 2 years legally walk away and only pay accrued interest and not maturity interest?


----------



## Sarenco (8 Apr 2017)

The process and timetable that Nationwide UK is employing to close their Isle of Man operation might give us some clues as to what might happen here -

[broken link removed]


----------



## Lightning (8 Apr 2017)

Good find.

The Q and A provides a list of answers about the closure steps for Nationwide IoM customers. One would guess that similar steps will be followed here. [broken link removed]

IoM customers with term deposits that matured in the near future, post closure, had to wait till maturity for payment but those with term deposits that matured at a later date got a letter with "special instructions".


----------



## skrooge (8 Apr 2017)

CiaranT said:


> No value leaving the regular saver account product, notice product and instant access product listed. No point anyone opening a new account with these products. Rate will probably drop to zero shortly before deposits are refunded.



But this is all speculation - removing all the products gave the impression of certainty that we simply don't have.  By removing it them without the facts the best buys stops being objective and becomes subjective.  It's not meant as as a personal criticism  - I for one appreciate the hard work you go to to keep the list up to date at keep all the relevant detail there as well. But we are straying from "best buys" to "CiaranT's view of best buys". 

Look at it another way, take the 24 month NWUK fixed rate of 1.2%.  It might be an even better option if I can redeem it early without penalty. It stops being a 24 month fixed term at 1.2% and becomes, for example,  an instant access or 6 month account at 1.2%.  I would have left the references to NWUK in the sections and flagged the uncertainty.


----------



## Lightning (9 Apr 2017)

The certainty we have is that Nationwide UK (Ireland) is closing down. It is not overly subjective to state that a time that a bank is closing is not an advisable time for most people to open brand new bank accounts. Providing a list of places where people can open a new account (and keep it open!) is the purpose of the best buys.

Whist gaming the closure is potentially possible, it is speculative at this point as to how Nationwide UK (Ireland) will operate their closure procedure.


----------



## skrooge (9 Apr 2017)

CiaranT said:


> It is not overly subjective to state that a time that a bank is closing is not an advisable time for most people to open brand new bank accounts. Providing a list of places where people can open a new account (and keep it open!) is the purpose of the best buys


`

As you seem to be suggesting there is every potential for some new accounts to reach maturity. Though I fully appreciate that these accounts may not be on offer for very long.



CiaranT said:


> IoM customers with term deposits that matured in the near future, post closure, had to wait till maturity for payment but those with term deposits that matured at a later date got a letter with "special instructions".


----------



## MrEarl (10 Apr 2017)

CiaranT said:


> ....
> 
> Open questions:
> - What happens to those that have term deposits that have not yet matured?
> - When and how will deposit holders be compensated? .....



Correct me if I am mistaken, but am I correct in thinking that Bank of Scotland Ireland did a deal to transfer some of their long term fixed deposits over to BoI when they exited the market ?   That may be a solution for Nationwide, if an arrangement can be reached with a bank that is staying open for business in Ireland.

Another option is that the Nationwide might just pay the interest early to facilitate the account being closed ahead of schedule.


----------



## Lightning (10 Apr 2017)

Yeah, Nationwide UK (Ireland) could sell the long dated term deposits. It's possible but most other banks these days have surplus deposits and may not be willing to accommodate but Nationwide UK (Ireland) could make it with their while. Hopefully, we find out for certain soon.


----------



## Lightning (10 Apr 2017)

The Irish Times have an article on the closure of Nationwide UK (Ireland) here. 

Still nothing on the Nationwide UK (Ireland) website.


----------



## Lightning (10 Apr 2017)

RTE have covered the closure here. 

Apparently it is Nationwide UK (Ireland)'s priority to keep customer informed. Well a good start would be a statement on their website with next steps.


----------



## MrEarl (10 Apr 2017)

CiaranT said:


> .....Apparently it is Nationwide UK (Ireland)'s priority to keep customer informed. Well a good start would be a statement on their website with next steps.



Rule No.1 - once a bank decides to leave the country, the customers matter the least


----------



## Lightning (12 Apr 2017)

I tried to get more information out of Nationwide UK (Ireland) but it seems like they are not ready to communicate with customers yet. Perhaps, 25 April 2017, the date mentioned in the media, is when we will get more information.


----------



## ardmacha (12 Apr 2017)

MrEarl said:


> Rule No.1 - once a bank decides to leave the country, the customers matter the least



In fairness, it isn't ideal for the staff either, who have to deal with grumpy customers without having the full picture themselves and who then lose their jobs. I always found the staff in Merrion Row and on the phone pleasant to deal with.


----------



## Gordon Gekko (13 Apr 2017)

Precisely.

Minor hassle for people who by definition have a few bob versus the loss of people's livelihoods.

Perspective required.


----------



## MrEarl (13 Apr 2017)

ardmacha said:


> In fairness, it isn't ideal for the staff either, who have to deal with grumpy customers without having the full picture themselves and who then lose their jobs. I always found the staff in Merrion Row and on the phone pleasant to deal with.



Yes, that is a very good point.


----------



## evanio (15 Apr 2017)

Received notice of account maturing on 2nd May inviting me to reinvest funds and no mention of closing


----------



## Lightning (15 Apr 2017)

Yeah, customers are getting renewal notices, new accounts can still be opened and there is still nothing about the closure on their website. It seems that the closure will not become official in any respect until 25 April.


----------



## Lightning (25 Apr 2017)

Nationwide UK (Ireland) have released the below statement:



> *Later this year, Nationwide UK (Ireland) is closing. We’re here to help*
> Nationwide UK (Ireland) is closing its doors later this year. This means you'll soon have to close any accounts that you hold with us, and, as of 25th April, we can no longer open new accounts.
> 
> Rest assured that all accounts are in safe hands and we will continue to offer you excellent customer service until they are closed. Accounts held with Nationwide Building Society in the UK are not affected.
> ...



- New account opening not allowed effective 25 April 2017.
- Accounts will need to be closed but no details given as to how or when.
- "Later this year" suggests that the closure process will take time.
- Their website still advertises new products and the CCPC still lists the products despite the fact that new accounts cannot be opened as at today.


----------



## mtk (26 Apr 2017)

I guess they had to do " consultation " process with staff to keep redundancies kosher and avoid unfair dismissal claims


----------



## Lightning (26 Apr 2017)

Nationwide UK (Ireland) have now removed new customer applications from their website.

I have contacted Nationwide UK (Ireland) trying to get more information on the closure procedure.


----------



## Lightning (2 May 2017)

Nationwide UK (Ireland) will close their Merrion Square branch on 31 May 2017. 

Nationwide UK (Ireland) say they have set up a Q&A on their website about the closure. Does anyone know where it is?


----------



## Lightning (2 May 2017)

The Q&A is buried on their website. It is [broken link removed]. It does not answer much.

From a conversation with Nationwide UK (Ireland) call centre, it seems that their operation will likely close on 30 September 2017. Term deposits that mature after that date are likely to get paid maturity interest early! Hence, nobody with term deposits should close their accounts early.


----------



## Duke of Marmalade (2 May 2017)

_CiaranT _do you know what the best alternatives for sterling fixed term deposits are?  It doesn't seem to be covered in Key Posts.


----------



## Gervan (2 May 2017)

Something like this, Duke? https://moneyfacts.co.uk/offshore/offshore-fixed-rate-bonds/
Also NS&I have a 3 yr bond at 2.2%, but max input is £3000 I think


----------



## Duke of Marmalade (2 May 2017)

Yes, _Gervan_, perfect.  These are offshore so I presume they are subject to full income tax, USC and PRSI?  Still much better than KBC's Irish branch sterling rates.


----------



## Hungryfool (3 May 2017)

'Term deposits that mature after that date are likely to get paid maturity interest early! Hence, nobody with term deposits should close their accounts early.'

Did they specifically tell you this?


----------



## Lightning (3 May 2017)

Yes. They did stress that no final decision has been made. However, if they are telling customers that maturity interest is likely to be paid early then I would be surprised if that does not happen.


----------



## Lightning (7 Jul 2017)

I'm told by a Nationwide UK (Ireland) staff member, that the closure procedure is likely to be:
- No early exit fees from 1 August 2017. (Seems the date may change slightly but 1 August 2017 is being targeted). 
- Interest paid early from 1 August 2017. i.e. If you have a term deposit maturing after 1 August 2017 you will get the maturity interest early! (As predicted!)
- Not clear as to what will happen to those with 12 Month Regular Saver products. Seems that 12 month maturity interest will not be paid early because the account is variable.


----------



## Sue Ellen (18 Jul 2017)

Any update on this i.e. when will they actually be closing down?


----------



## Lightning (19 Jul 2017)

Hi Sue, 

Nothing officially confirmed yet but it seems, based on conversations with staff, that penalty free access to your money with maturity interest will be allowed in early August 2017 with account closure by 30 September 2017 if you do nothing.


----------



## Sue Ellen (19 Jul 2017)

Thanks for that Ciaran.


----------



## ardmacha (23 Jul 2017)

Let's hope there is time between Nationwide releasing the deposits and the NTMA cutting their State Savings rates.


----------



## Lightning (24 Jul 2017)

Confirmed that Nationwide UK (Ireland) is closing on 29 September 2017.

You can now close accounts with no penalties and "without loss of interest" according to a letter I got today. Not sure if this applies to all accounts for everyone yet. I am emailing Nationwide UK (Ireland) to confirm that this means you get maturity interest up front.

No news on the rate that now applies to the 12 Month Regular Saver account.


----------



## evanio (24 Jul 2017)

received account closure form in respect of regular saver in post today


----------



## evanio (27 Jul 2017)

They are only paying interest accrued on regular saver.Not surprised that there has not been a reply to Ciarans query regarding interest up front.The fixed rate accounts were for a fixed period and if you failed to complete the term there were penalties so surely if they are closing these accounts the customer is entitled to total interest for the agreed period as they are breaking the contract. either way it will not make anybody rich given the miserable rates on offer.


----------



## Lightning (27 Jul 2017)

I got a response yesterday on the fixed rate query. Confirmed that Nationwide UK (Ireland) will now pay maturity date interest up front. You can now close your account with maturity rate interest.

Yeah, only accrued interest paid on the 12 Month Regular Saver account.


----------



## Eithneangela (29 Jul 2017)

Apart from notification a few months ago about the impending closure, haven't heard anything from them since. I have a 3 year savings deposit with them which doesn't mature for another year. Should I be chasing them up?


----------



## Lightning (29 Jul 2017)

Yes, in the sense you can get your interest now. You could ring Nationwide UK (Ireland) and say you want to close the account with maturity interest up front and they will do it for you.


----------



## discovery101 (2 Aug 2017)

Hi there....I have a 24 month loyalty fixed rate account.....I am in the process of closing my account will i get all my interest upfront?


----------



## Lightning (2 Aug 2017)

Yes you should. Confirm when closing to be certain.


----------



## evanio (2 Aug 2017)

Closing statements state "interest up to date of closure" but they assure me they are paying up to date of maturity. Just a little misleading.


----------



## Lightning (2 Aug 2017)

Agreed. You will get maturity interest.


----------



## DMcL1971 (4 Aug 2017)

Different account types seem to have different closing dates. The letter relating to my Regular Saver Account states it must be closed by 29th Sept but the letter relating to my Easy Access Account states it must be closed by 13th Oct.


----------



## fizzy (4 Aug 2017)

I think they may be staggering the closing dates generally. I got my letter a week ago with a closing date of 6 Oct, but know someone else who got it today with a closing date a week later 13 Oct (so exact same notice period length) - both easy access accounts.



DMcL1971 said:


> Different account types seem to have different closing dates. The letter relating to my Regular Saver Account states it must be closed by 29th Sept but the letter relating to my Easy Access Account states it must be closed by 13th Oct.


----------



## cork (23 Oct 2017)

What is the procedure to close an account - must you contact them?


----------



## Lightning (23 Oct 2017)

Yes, you need to contact them. At this stage, you should do it urgently.


----------

