Nationwide members pocket £350 million loyalty bonus

NATIONWIDE is set to hand a loyalty bonus worth at least £350million to millions of members.

The building society last year gave some 3.3 million customers £100 each. But the latest payout could be even higher because the mutual’s profits have been buoyed by higher interest rates.

Nationwide has said it wants to capitalise on this to continue paying a ‘Fairer Share’ bonus to eligible members.

The details, which will be announced on Thursday, will come a day after Virgin Money shareholders decide on whether to accept a controversial £2.9billion takeover offer from Nationwide. The mutual, which is owned by its 16million customers, has come under fire for not offering them a vote on the deal – the largest in UK banking since the 2008 financial crisis – and for not spelling out the benefits of the takeover.

It argues that buying Virgin Money will create a combined group with ‘enhanced financial strength’, ranking only behind Lloyds Banking Group in terms of savings and loans. Opposition to the 220p per share deal has been growing – and not just from Nationwide members who claim they have been denied a vote on a ‘technicality’.

As the Mail on Sunday revealed last week, Virgin Money’s biggest independent investor attacked the board for recommending Nationwide’s offer, which it says is ‘likely to sell shareholders very short’.

Allan Gray, an Australian fund management group which holds 10 per cent of Virgin Money, said it was ‘disappointed’ with the offer, though it did not say which way it would vote. Australian investors hold the key to the outcome as they own just under half of the bank’s shares. This is a legacy of when the former Clydesdale and Yorkshire Bank Group was owned by National Australia Bank. Sir Richard Branson’s Virgin Group has already pledged its 15 per cent stake in favour of the deal.

The tycoon stands to receive more than £600million for his shares and licensing add-ons.

Virgin Money needs three-quarters of voting shareholders to approve the deal, which experts say is quite a high bar.

Nationwide declined to comment.