Remarkable Barbara A. Panvel who created the Attwood Award and coordinates the New Era Coalition of movers and shakers sent this letter to a number of newspapers:
Despite the current financial anxiety, it should be noted that there are over sixty stable financial institutions in Britain.
The impact of the financial crisis has been lightest on the financial institutions that have been run more conservatively, particularly those that remain within the mutual sector. The Co-operative Bank was not linked with sub-prime lending in Britain or USA
As business editor Robert Peston notes, every building society floated on the stock-market – becoming a bank – has failed.
Regulations restrict building societies from raising more than 50% of their funds from the inter-bank market and the average proportion of funds raised by building societies from the wholesale markets is 30% – the rest coming from members’ deposits.
Unlike banks, they do not pay dividends to outside shareholders and – according to the Building Societies Association – this obligation adds 35% to the operating costs of a bank.
Savers are now turning to ‘real’ building societies which received £1.26 billions in savings in March, compared with £700 million the year before, deposits being more than twice the amount loaned.