What future do the building societies have with carpetbaggers lurking around every corner? Business Editor Paul Parker reports

THE BOSSES and members of Yorkshire's thriving building societies are showing what they are made of in the face of attacks from carpetbaggers.

Bradford's Yorkshire Building Society saw off the king of the carpetbaggers, Michael Hardern, last week when it rejected his bid to join the board and force a vote to turn it into a bank.

And today the Skipton Building Society board meets to decide what to do with a similar bid from the Royal butler.

They are determined to fight for mutuality - the guiding principle of all building societies. This means that the building societies work for the benefit of the members - not like the banks whose masters are the shareholders.

Converting the Yorkshire into a bank would have had a devastating effect on the local economy with more than 1,000 jobs lost, the loss of a brand which would cost £80 million to reconstruct and its headquarters status.

The same could apply to the Skipton - and its board feels the same as that of the Yorkshire.

The Skipton is still making some investors donate £25 to the NSPCC when they open an account, which has netted the children's charity £400,000.

Turning into a bank would probably mean the end of the financial institution which started life in 1853 as the Skipton and District Permanent Benefit Building Society.

From being a local firm, the Skipton is now a nationally recognised business with nearly 500,000 investors and 106,000 borrowers.

But it is too small to operate as a bank alone and it is likely that a much larger bank would buy it out and impose its identity on Britain's eighth-largest building society.

The Bradford & Bingley is facing a similar bid from Northern Ireland plumber Stephen Major who has succeeded in forcing a vote on converting the building society into a bank but has withdrawn his bid to sit on the B&B's board.

Bosses at the Bradford & Bingley are confident that they will survive the conversion vote due on April 26 - probably at St George's Hall in Bradford.

But far from being cowed by the conversion process - which started with the Abbey National in 1989 - today's building societies are in a stronger position than ever before.

Pam O'Keefe, of the Building Societies' Asso-ciation, says the country's 71 building societies, who have 19 million savers, assets of £140 billion and branches on every High Street, have never had it so good. This is borne out by Linda Will, the Yorkshire's marketing manager.

She said: "People have come to us from the banks in droves.

"Our membership has almost doubled in the last few years because people see that we offer a better deal in better mortgage and savings rates."

Once the latest round of attempts by carpetbaggers is over, bosses at some of the building societies have vowed to wage a campaign to change the law.

Pam O'Keefe added: "We fought a previous campaign but Treasury Minister Patricia Hewitt said nothing would change.

"But how can it be right that 50 people can change the nature of an organisation which has millions of members in it?"

Michael Hardern has vowed to carry on his fight to change the face of Britain's building societies - including having another stab at the Yorkshire by the end of this year.

But the building societies are fed up with having to have the equivalent of an election every year to keep their mutual status.

Converted for the new archive on 30 June 2000. Some images and formatting may have been lost in the conversion.