The ratings on Nationwide Building Society reflect the society's strong position in the U.K. mortgage market, strengthened asset quality and arrears control, better levels of operating efficiency, and good capitalization. Profitability remains satisfactory, despite the dampening effects of a strategy of rewarding members through the competitive pricing of products. This strategy reflects Nationwide's commitment to retaining its mutual status. In July 1998, Nationwide voted to remain mutual. Revised membership conditions introduced in 1997 mean that new members would have to waive any windfall conversion gains in favor of a charity. Nationwide's status as the largest building society in the U.K., combined with extensive advertising, has enhanced its already-strong franchise. The society benefits from a substantial and stable retail deposit base.
