Industry response

Retail Banking Business Model Review

Building societies compete with retail banks, particularly in the retail savings and mortgage markets, where societies are required by legislation to focus, but also in some cases in personal current accounts. We believe that building societies provide a competitive constraint on banks operating in these markets. This is due to differences in ownership structure and fundamental purpose that affect societies’ choice of business model and general approach, including risk appetite, as their managers and employees face different incentives than do those in shareholder-owned banks. They also tend to value the development of sustained relationships with their members rather than dealing with them purely on a transactional basis.


We encourage the FCA to endorse the role that a diverse range of organisational forms and resulting business models can play in promoting effective competition in consumers’ interests, both today, and as technological, social and economic changes occur.

Read the submission here.