Will Irish savers go Nationwide?

WHILE THE Irish banks eye each other up and seek new investment, Britain's Nationwide Building Society is progressing plans to launch here next March, subject to approval from the Financial Regulator.

Executives were in Dublin this week to meet various parties in pursuit of a plan devised about a year ago, before the credit crunch and recession hit. "We aim to offer online, postal and telephone services," a spokesman said. "Our plan is to offer an instant-access savings account and a fixed bond . . . there will be options on both."

He said the move would give the building society access to "another source of funding and, if needs be, it will gives us access to ECB funding".

Nationwide is Britain's biggest building society. If its plan to merge with the Derbyshire and Chester building societies succeeds, the combined entity will have 15 million members, about 1,000 retail outlets, £191 billion (€228.4 billion) in assets and £122 billion in retail deposits.

With Irish Nationwide Building Society already established here, Britain's Nationwide is conscious of the need to differentiate the brands. "We're very aware of the need to completely distinguish ourselves so that is under consideration as well."

Competition is never a bad thing for consumers. It's not necessarily a bad time to offer savings products, given most Irish people are seeking to save rather than spend. And if the Irish banks end up merging with each other, a gap might open in the market.

That said, Nationwide will have to offer stonking good interest rates if it hopes to attract large numbers of Irish savers, given that money held with domestic institutions is fully guaranteed by the Government for two years.

The memory of people queuing outside the Dublin office of UK bank Northern Rock, which launched a similar service here some years ago, might also weigh on minds.