240 jobs risk in building society HQ closure plan
A DECISION to shed up to 240 jobs at Derbyshire Building Society and close its Duffield Hall headquarters has been condemned by business leaders in the county.
Nationwide, which merged with the Derbyshire two years ago, is also to close several of its branches.
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It said that the move was necessary to sustain the future of the society.
But George Cowcher, chief executive of Derbyshire and Nottinghamshire Chamber of Commerce, said: "This is extremely sad.
"The Derbyshire is our building society, we gave it its name and we feel part of it.
"Its identity has been swallowed up by a national company that has not got any feel for the area at all. It is hugely disappointing.
"At a time when the banking sector is trying to repair its image and be seen to be supporting communities this does them no favours."
The Derbyshire, which was founded in 1859, initially approached Nationwide to form an alliance in 2008. At the time it faced a £17 million deficit because of its exposure to mortgages and loans at risk of default. Peter Richardson was chief executive of the society until 2007, when the board decided that the society needed a change of leadership.
Mr Richardson, who spent 10 years with the society before taking up a position as chairman of Derby Cityscape, said: "This is a massive shock to me and, I'm sure, to the employees at the Derbyshire.
"Throughout my time at the society the board never mentioned anything about a merger. If I had still been chief executive when the proposals to merge with the Nationwide were first talked about I would have objected to it.
"I feel that the Derbyshire was strong enough to carry on as it was. The board probably felt there was more safety in joining forces with a large society like the Nationwide.
"But if someone had told the board at the time that it would mean the Derbyshire losing Duffield Hall then I'm sure they would've thought twice about it.
"This is not just a blow for the Derbyshire, the building society, it is a blow for Derbyshire, the county."
As soon as the merger deal was signed, Nationwide began a review of the Derbyshire's operations.
The result is that 12 branches will shut, resulting in the loss of about 60 jobs, and around 180 positions will go at Duffield Hall, where 320 people are employed. The remaining 140 will be offered positions elsewhere in the Nationwide group, including several within Derbyshire branches.
Staff were told about the changes yesterday.
The majority of branches which are to shut are outside the county boundary, with the exception of three – Buxton, Chapel-en-le-Frith and New Mills.
Nationwide said these had been chosen either because of low customer use or because they were in close proximity to existing Nationwide branches.
But a bigger blow is the planned closure of Duffield Hall.
Nationwide said it had identified duplication of roles between its staff based at its headquarters in Swindon and Derbyshire workers at Duffield.
Nationwide has promised that the Derbyshire brand will be maintained, focusing on savings and investments.
It has also decided to stop offering Derbyshire branded mortgages, due to low sales, and Derbyshire customers wanting new mortgages will be offered Nationwide products instead.
Matthew Wyles, Nationwide's group distribution director, said changes were needed to sustain the future viability of the Derbyshire.
He said: "Since rescuing the Derbyshire we have remained committed to keeping their presence on the High Street. But it became clear that we needed to make a number of changes.
"The strategy we have outlined is designed to strengthen our regional brands, giving the Derbyshire the focus and clarity needed for it to succeed.
"The decisions we are taking are absolutely vital and would have been inevitable for any business wishing to stabilise and maintain the Derbyshire for the benefit of members.
"We are fully supporting our people and members through this period of change, while ensuring our business focus is maintained and the service to our customers is protected."
Around the same time Nationwide merged with the Derbyshire, it also took on the Cheshire and Dunfermline societies.
The Cheshire will close in the next two years, but the Dunfermline's headquarters will be used as an administrative centre for Nationwide's regional brands, including the Derbyshire.
Nationwide said a small satellite office for Derbyshire's non-branch operations would continue operating at Little Eaton.
Jeremy Hicks, Nationwide's senior corporate affairs manager, said: "A critical thing is that the proposals are to make the changes over two years.
"This gives us a huge amount of time to advise our staff on what the next step will be. We will make sure they're aware of the support we can give them."
Businesses and residents in Duffield said that the loss of the Derbyshire's headquarters would be a blow for the local economy.
Jo Harrison, who works as a supervisor at the Co-op store, in Town Street, said: "It's going to really hit trade at a difficult time. A lot of Derbyshire staff use our shop."
Richard Rice, of Nether Close, who has lived in Duffield for 33 years, said: "It's going to have an impact in terms of trade. I'm also worried about what will happen to the Duffield Hall site."
Duffield Hall has been the home of Derbyshire Building Society since 1977.
A Grade II-listed building, it is thought to have been built in the 1620s for the Newton family.
It
was later home to several High Sheriffs. One of them, Rowland Smith,
bought the property in 1860 and extensively restored and improved the
house creating the present mansion.
The house was occupied by St
Ronans School from the 1920s until 1970, when the property was bought
by Derbyshire Building Society, which moved in following restoration
work.
The society itself was formed in 1859. In 1966 it merged
with Ashbourne Permanent Benefit Building Society and Somercotes
Building Society.
It also absorbed Ilkeston Permanent Building Society in 2001.
By 2007 it was the 10th largest building society in the UK, with 450,000 members and 750 staff.
26 Comments
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by Friend of Roger Hollick, Derby
Friday, June 11 2010, 5:54AM
“Well, I think we are all agreed that PR sunk the good ship DBS. I bumped into him recently and had a 'pleasant' chat. My Mum said "Who was that?. The fatherless child who made me redundant I replied!”
by B, Derby
Thursday, June 10 2010, 9:23PM
“Totally agree Kirsty. The remaining staff cannot be held responsible for the strategic decision to sell the IoM operations overseas. No one predicted the Icelandic crisis.
Derbyshire staff below executive level have always put their customers first. Cared for their communities. Staff are very upset. The audacity of Mr Richardson to make comment when had he not taken "early retirement" he would have had no option but to seek a merger due to his mis management of the company. I firmly believe his replacement probably had no option but to seek help from Nationwide. Without it the Derbyshire would have gone bust. And that is in noone's best interests.
It is a pity that the Nationwide haven't really tried to make the Derbyshire work. Had they done so the losses this week could have been minimised. Duffield may have kept the Hall - so important in such a small local community. But no national organisation so large is ever going to understand the importance and value of a local regional building society. Staff have seen the Derbyshire brand gradually erode since the merger. Ultimately it is the mismanagement of a few senior people pre merger that should hold their heads in shame and the lack of effort of the new senior management post merger. I pity the future of Derby with Mr Richardson as chair of Cityscape. From ruining a local business and community he is on to bigger and better things - the ruin of a city.
Our thoughts are with the staff who are losing their jobs. They suffer the most in the end. And have done nothing wrong. Just loyally serve their company.”
by Kirsty, Derby
Thursday, June 10 2010, 7:46PM
“Su...how can you honestly wish someone NOT to get another job - not to be able to pay their mortgage? put food on their table for their children??? It is not the fault on those selling you the product (because they had to!) but the fault of those in charge. Yes this is obviously an extrememly sore subject and you are right on most levels but to say something like that is just cruel!! The staff are only the puppets on a very long string!!”
by Friend of Roger Hollick, Derby
Thursday, June 10 2010, 7:37PM
“Roger was the one person who really cared about the place and it's staff. PR is nothing short of a fake. I was really proud to work there but I was made redundant in 2004 after 24 years. PR even broke the society's security policy on internet use.”
by christopher, allestree
Thursday, June 10 2010, 1:03AM
“As an ex employee of DBS it was indeed a sad day when all the previous commitment to serving a regional based client base with specific sound products went out the window with offshore liabilities and risky trading abroad. The DBS had policies and protocol that would not even permit lending to it's own staff where security could not be seen to be beneficial to the society, those were the days when standards of business mattered.
As for Nationwide, their size may equip them to become the Saviour of smaller competitors - but they have accomplished some of this by failing to pay many individual investors during the past decades a reduced percentage of deposits received. Reality rules in the REAL world !”
by pedro2010, nottingham
Wednesday, June 09 2010, 11:35PM
“Maybe Mr R Hollick could give the reader his views. Now there was a man who cared for the members as well as the employees and everything that was Derbyshire. And the hundreds that meet him from time to time can still without shame call him BOSS”
by Richard, Oakwood
Wednesday, June 09 2010, 11:19PM
“it will be a shame to see our building society headquarters go but the building society just can't cope with todays customer.
I remember back in the day they would acctually accept your money, i go in now and they won't take your money unless the coin is exactly the right ammount for a bag and you can only put 5 bags in, suppose i'll have to take my money elsewhere if they don't want it. if your saving your coins you never have just 5 bags.
it's just too much work to pay money in and also withdraw that i just find myself going elsewhere, maybe if they were more accessable then it wouldn't be in this situation”
by MI DBS ex-empoyee, Derbyshire
Wednesday, June 09 2010, 10:05PM
“HOW DARE PETER RICHARDSON go on local radio and in the local press and say: " This is a massive shock to me" & "Throughout my time at the society the board never mentioned anything about a merger" & "If I had still been chief executive when the proposals to merge with the Nationwide were first talked about I would have objected to it."
Is this man so Arrogant, so Thick Skinned, so Ignorant or just so Stupid not to realize it was during his time in charge that the Derbyshire was brought to its knees? And to the position that the only way to stop it going bust was ¿TO BE TAKEN OVER BY THE NATIONWIDE¿? (Or rescued as it¿s really called)
This is the man who for years ran and treated the Derbyshire Building Society as if HE and not the society¿s members owed it.
This is the man who looked into selling the Duffield HQ years ago to relocate to a site away from Duffield.
This is the man who made the Derbyshire BS buy the private registration number ¿M1 DBS¿ (meaning MY DBS) for ONE of his company cars.
This is the man who overnight took ¿early retirement¿ as soon as the brown stuff started to hit the fan, and then appeared the next night in the Derby Evening Telegraph saying that he couldn¿t see himself being retired for long.
How many investors lost thousands of pounds when part of ¿their¿ (the society members) business was sold off to the Icelandic Bank?
How many employees have lost their jobs through the business diverting away from the core values of what Building Societies were set up for?
How many local businesses will lose trade through the closure of the Duffield HQ?
How many local suppliers and business¿ lost out after the takeover when the Nationwide started using their own large national suppliers instead of the local business¿ that had carried out excellent work for them, cost effectively for years?
How many employees of the Derbyshire will have taken on large mortgages and loans over the past few years thinking that they were working for a strong local business with a great future ahead of it?
How many investors lost out on a windfall when the Derbyshire was basically just given to the Nationwide? The Directors all got their windfalls with their massive pay-offs, but surprise surprise, it was never disclosed how much Mr Richardson walked away with.
Care to share this info with everyone Peter?
Or answer any of the above questions?”
by Caz, Alvaston, Derby.
Wednesday, June 09 2010, 8:46PM
“Goodbye Cityscrape.”
by Carole, Derby
Wednesday, June 09 2010, 8:35PM
“Maybe some of the 'suits' who care - George Cowcher you must know a few, EXCLUDING Richardson - will put up the money to buy back The Derbyshire, from the Government, sorry , TAX PAYERS, who bailed out the Nationwide and many other financial institutions so recently.
We want our ball back!
With proper leadership The Derbyshire will have expats returning, ( I moved all my accounts once I saw Richardson' incompetence and sponsorship of Derby County when they were run by crooks), and new business will easily be generated.
Anyone interested in raising the phoenix from the ashes should say so. My email roselyn54@live.co.uk”