Transfer of Virgin Money into Nationwide approved: millions become members overnight

You might have seen reports in the press this week that the High Court has approved the transfer of Virgin Money’s business into Nationwide (e.g. The Sun, The Mirror).

This was a legal application made by Nationwide to transfer nearly all assets, liabilities and customers of Clydesdale Bank plc (trading as Virgin Money) into Nationwide. In so doing, ~7 million customers of Virgin Money will join Nationwide, and most are expected to become members of the building society as of 2nd April 2026.

My objection

I attended the High Court on 23rd February 2026 as a member of Nationwide Building Society to object to the scheme.

My primary concern with this transfer relates to what I consider unfair treatment of Nationwide members. While Virgin Money directly wrote (by email and post) to all Virgin Money account holders about the transfer and its impact, Nationwide decided not to communicate directly with existing Nationwide accountholders (i.e. its member owners) about the proposal, reducing the number of objections.

Nationwide assessed that existing members would not be affected by the Transfer, and Nationwide didn’t want to incur the cost of informing its own members of the change.

I disagree with this assessment on two grounds, which I shared with the Court.

1. The transfer substantially removes the Virgin Money / Clydesdale Bank subsidiary from the Group structure.

At present, the Clydesdale subsidiary has its own legal personality: it produces separate statutory and regulatory reporting which is then consolidated as part of the Nationwide Group accounts. The subsidiary can also raise its own capital, or be divested, at a later date.  There is today, in effect, a degree of independence and ring-fencing of the acquired business from the mutual core. 

With this transfer, members lose information rights regarding the performance of the acquired business. Going forward, there will be less transparency, and it becomes much harder to hold management and the Board to account – particularly with regards to their decision to acquire Virgin Money, and denying members a vote in the process.

Note that since the acquisition, Nationwide has injected nearly £1.1 billion of equity into the Clydesdale subsidiary to improve its capital position as it aligns with Nationwide’s accounting standards. Profits are also down significantly since the deal was announced (more below).

2. The transfer creates millions of new Nationwide members overnight.

Virgin Money customers are not currently members of the building society.  They cannot participate in governance activities (e.g. vote at the AGM), and they are not eligible for Fairer Share payments.

A large influx of new Nationwide members created by the transfer risks upsetting the balance of governance and also dilutes the economic rights of existing Nationwide members.

If Nationwide demutualises later (which management stress is not their intention), these new members are deemed to have assigned their conversion rights to charity, The Nationwide Foundation, in common with society members joining from November 1997 onwards. Members prior to this date, who would benefit personally from a demutualisation, are effectively diluted by a much larger group of members.

And what about the (highly complained about, and to some unfair) Fairer Share payments? Nationwide argued when buying Virgin Money that is was a better use of members capital than leaving these on deposit (risk free) at the Bank of England. Virgin Money reported just £110M in profits for the 18 months ending 31 March 2025, which vs. the £2,900 million paid for the business, suggests this logic no longer holds true with a cash return of just 2.5% annualised.

With more members expected to be eligible for the Fairer Share payment in the future, and profits not increasing by the same proportion, there is clearly less to go around after the transfer, than before. It is entirely possible that in 2027 new members from Virgin Money will earn a Fairer Share, while some existing members, who have held a Nationwide savings or mortgage account for decades, will get nothing.

Court determines that members are not ‘materially adversely affected’ so transfer can proceed

Despite my objection, and other objections shared by others both in writing and in person at the hearing, the Judge determined that none of the objections were sufficient, falling short of the Court’s test of whether people are ‘materially adversely affected’ by the Transfer.

The Judge therefore decided to sanction (i.e. permit) the scheme.  The Transfer is due to take place in less than 6 weeks’ time, on 2nd April 2026. See the Virgin Money website for more detail.