According to Nationwide's yearly results, borrowers deserted from banks to building societies last year at a rate of 2,500 every day. The recently published results revealed that more than 875,000 new customers have joined the Nationwide during the last twelve months. It is believed that the reason for this exodus is due to lower mortgage rates and higher saving rates at building societies compared to banks.
Our view:
High street banks and brand names have traditionally offered not always the best rates because they do not have to compared to smaller, less well known operations or mutual organisations such as Nationwide (a huge mutual). Do not be fooled though by the 2,500 a day figure. People are moving for best deals and not 'mutuality'. If some big hitting banks wanted market share based upon competitive mortgage rate they could easily flex their interest rate competition muscles.