Scotlands Dunfermline Building Society Crisis Talks
Published / Last Updated on 22/03/2009
Scotland’s Dunfermline Building Society Crisis Talks
The largest building society in Scotland, the Dunfermline Building Society is in talks with the financial services regulator, the Financial Services Authority (FSA) after speculation of losses of up to £26m.
Speculation has suggested that the losses have come from losses in the commercial property market although we cannot quite believe this given that societies are supposed to have only a very small proportion of their lending business in non-residential lending (this is the law as part of the Building Society Act).
There are possible other influencers on this such as poor quality residential mortgages or even it could be that Dunfermline placed investment deposits with failed banks, such as other larger building societies have done.
Only time will tell if jobs and deposits are safe. Building Society deposits are covered under the £50,000 investors compensation limit.
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