Niedrigzinsen bei Bausparkassen — ein Urteil des Bundesgerichtshofs

At the end of February 2017 the Federal High Court of Justice rules that building societies are allowed to terminate old contracts ahead of schedule. A lot of old contracts are problematic in the viewpoint of building societies due to high deposit interest rates. High deposit interest rates are dangerous for building societies in times of low interest rates, especially if low interest rates are long-lasting. The Federal High Court of Justice follows the opinion of the building societies that during saving periods, building societies can be seen as borrowers, and borrowers have the (exceptional) right to terminate contracts after ten years, which is established in the German Civil Law. A microeconomic intertemporal consumption model calculates this as an overreaction byf the Court: Building societies should only be allowed to reduce deposit interest rate to be compensated for non existing loan contracts.     

Aspects of Innovation in a Turbulent Market Environment: Empirical Evidence from UK Building Societies

The personal financial services market is currently experiencing a period of turbulence as the industry adapts to changes in the environment. This in turn has forced many of these institutions to consider a more innovative approach in their operations. A survey was conducted to investigate how one subset of this industry, building societies, are meeting this need for change. The results suggest that societies have begun to foster a more innovative organisation but that the level of innovation has not yet reached a satisfactory level.     

Employment and location patterns of advanced services in non-urban Canada

British building societies have developed into major financial institutions with a major influence on both the housing and savings market. This article examines one facet of their influence: the pattern of mortgage lending within a city, the city of Glasgow. Variations in urban lending are examined and an assessment is made of how far lending patterns can be attributed to the structure of the building society industry and, among other influences, differences in society size and branch location.     

The Impact of Regulation on the Strategy and Structure of Building Societies

A new Building Societies Act was passed in July 1986, radically changing the regulatory framework governing societies which had remained in force since 1962. The provisions of the Act allow societies to move into areas of activity from which they have previously been prohibited. At the same time that legislation was being passed specifically relating to building societies, the whole of the personal financial services market was experiencing what is generally seen as a revolution. Hence societies find themselves at a development crossroads at a time of great uncertainty. Although there has been much informed and some speculative comment, there has hitherto been little attempt at quantifying the likely future directions that building societies will take. This article seeks to remedy this situation by drawing upon the results of two surveys in which senior building society executives and their counterparts in other financial institutions were invited to give their views on the trends in personal financial services provision over the next five years.     

Retaining customers in traditional retail financial services: interviewing 'les responsables'

This paper explores organizational concerns with retaining customers in traditional retailing of financial services. Managers, charged with retaining customers ('les responsables') in banks and building societies, are interviewed seeking their views on how their organizations retain customers. The study finds that there are a number of shared themes in the sample of informants, which are evolution/flux, customer information systems, a product/sales orientation, delivering financial services, staff and relationships with customers. Underlying these themes, however, appears some equivocation as these organizations try to retain customers when customer acquisition seems to be the thrust of their marketing.     

In Defence Of Mutuality

“There was something a little unseemly about how the building societies intending to demutualise did so by encouraging their members to vote in favour with the inducement of significant payments in shares”. Should one have no regard for the intentions of those who produced the present capital accumulation, or for the idea of holding reserves in trust for future members? The author is DBM Professor of Corporate Governance at Leeds Business School, Leeds Metropolitan University, Calverley Street, Leeds LS1 3HE.     

Testing for Expense Preference Behaviour in UK Building Societies: the Implications for Measures of Scale and Scope Economies

It is well established that utility maximising managers who are not owners of the firm may engage in expense preference behaviour. This article provides the first test for expense preference behaviour in UK building societies. A translog cost function is specified and a direct test for expense preference is conducted which avoids the restrictive assumptions of the intercept test which has been used to test for expense preference behaviour in a number of previous articles. The specification of a translog cost function also permits the estimation of scale and scope economies in UK building societies and this paper compares the estimates obtained when expense preference behaviour is present with previous estimates obtained under the assumption of cost minimising behaviour.     

Building Societies and Strategic Sourcing: Criteria and Dynamics

In the literature of strategic management outsourcing has become recognised as a means to achieve a range of strategic benefits. This article examines the criteria employed by building societies to select and evaluate opportunities for outsourcing. The societies’ sourcing decisions are subject to multiple criteria that, together with a conservative culture, act to limit the use of outsourcing. Case material is used to develop a model of sourcing that relates the processes of evaluation, review and learning to changes in the technological, legal and market environment. Changes in the environment require the societies to retain the ability to monitor; review and possibly reverse sourcing decisions.     

The strategic use of corporate philanthropy: building societies and demutualisation defences

This paper examines the strategic use of corporate philanthropy in the 1990s by UK building societies faced with an intensification of societal pressure to change legal form from mutual to corporate status. While the economic case for mutuality has been made elsewhere, this paper examines the observation that community relationships were thought by management to be capable of assisting in the strategic positioning of mutual societies with regard to their legal form. By increasing charitable giving to respond to the level of societal scrutiny and discussion on the issue of mutuality, this paper argues that charitable giving, as one proxy for community involvement, was used as a strategic tool to deflect calls for demutualisation, thereby preserving the existing mutual status of building societies.     

Additional Capital Adequacy Requirements for Class 1 Lending - the Implications for Building Societies

In March 1990 the UK Building Societies Commission (BSC) published a Prudential Note (1990/1) entitled ‘Capital Adequacy and Class 1 Advances' which made important and significant amendments to the original capital adequacy calculus pertaining to Class 1 assets as set out in Prudential Note 1987/1. Against the backdrop of sharply rising mortgage arrears and provisions, this paper analyses the background to these requirements and assesses the potential impact upon individual societies and the industry as a whole. The main conclusion is that the new requirements could have a significant impact upon some building societies and may well accelerate the merger movement within the building society industry.     

Economies of Cost in the UK Building Society Industry

In recent years the UK building society industry has seen increases in the competitive nature of financial services,especially from other non mutual intermediaries. The decreasein the availability of retail deposits, a traditional source of fundsfor building societies, has led many to consider. merging operations. It is the aim of this paper to determine whether there were eficiencies in merging by considering economies of costs in the industry. We discuss the averuge cost structure of the industry and estimate a cost equation that has no a

prior theory regarding the underlying cost structure of societies.

This equation allows a comparison with previous research of the industry that have followed specific modelling methodo1ogies.     

The Influence of Mutual Status on Rates of Corporate Charitable Contributions

The claims by the Building Societies Association (BSA), some mutual building societies and other observers that mutual status is associated with higher levels of charitable and community involvement than public status banks are tested using the proxy of charitable donations in cash as a proportion of profits before tax (PBT). Using a sample of 31 of the remaining 65 mutual societies and the population of U.K.-based retail banks and still-independent demutualised banks, two hypotheses were tested: first, that charitable giving as a proportion of PBT over the period 1990–2003 was higher for mutuals than banks and second, that longitudinal records of charitable donations as a proportion of PBT for former mutuals will show a lower rate after demutualisation. Neither hypothesis was convincingly supported allowing for the conclusion that any claims suggesting that mutuals are structurally more generous than public companies are not supported by empirical evidence.     

Consequences of Mutual Ownership for Building Societies

This paper argues that the mutual ownership of building societies entails, in principle, different objectives from those of a company. It considers whether members' interests are best served by maximising either surpluses or growth and reviews evidence on economies of scale and effciency compared with banks. Conversion seems unlikely to result in great improvements in effciency and it is hard to say whether members benefit from free shares by more than they may lose as customers. The case of Abbey National is examined in the light of the reasons it gave for conversion.     

The Path to Service Encounter Performance in Public and Private ‘Bureaucracies’

This article examines the evolution of building societies against a background of environmental change. By the application of specific analytical measures developed by Ansoff five distinct periods of change can be isolated. Key events in the environment have become progressively more novel, less predictable and costlier to deal with, which, in turn, has necessitated both operational and strategic redirection.     

Word Power: The Impact of Negative Media Coverage on Disciplining Corporate Pollution

Globalization is multifaceted and involves the interaction among businesses, services, governments, and societies beyond national borders. As a result, the flow of foreign direct investment (FDI), international trade in goods and services, and the economic interdependence of the nations of the world have been increasing. At the same time, much attention has been paid to the effect of corruption prevalent within many cultures and societies, and its impact on the economies, especially developing economies. This paper examines the relationship between human capital investment, the level of national corruption, and the global economic integration (GEI) of a nation in developing countries. Based on the data collected from over 60 countries, and building on the FDI and human capital theories, it was found that human capital investment and corruption are related to GEI. It was also found that the level of corruption moderates the relationship between human capital investment and GEI of developing economies. The findings of the study can help to deepen our understanding of GEI and have practical implications for developing countries in terms developing human capital, which plays a critical role in today’s knowledge-based economy.     

Direct marketing in the financial services industry

This article presents empirical research findings on the use of direct marketing by a representative sample of UK financial services institutions. A number of similarities and differences between banks, building societies and insurance companies are identified in relation to direct marketing programmes and the use of particular direct marketing techniques. While acknowledging some exceptions the research concludes that there is scope for a greater appreciation of the strategic value and workings of direct marketing. Institutions could usefully focus attention on achieving fuller integration of direct marketing with other marketing and communication activities and securing improvements in testing, database quality and timing.     

Marketing,violence and social cohesion: first steps to a conceptual approach to the understanding of the normalising role of marketing

ABSTRACT

This paper answers a call for contributions ‘dedicated to revealing how markets and marketing make violence culturally acceptable and socially normalised’. Such an investigation has to involve some in-depth conceptualisation with respect to the meanings of both marketing and violence. The market is an institution related to other institutions which altogether are – as in all societies – trying to cope with violence. Today our societies are based on both markets and democracy, but those institutions tend to be mutually contradictory. When marketing tends to replace politics and to almost religiously convert citizens into consumers it is social cohesion that is at stake. This paper aims at contributing to a deeper understanding of social/historical trends. As it highlights the importance of ideas (representations and motivations) and their links with changing institutions, it might help researchers and marketers to a broader understanding of their role and towards a more conscious social behaviour.     

Consumer values,motivation and purchase intention for luxury goods

There is considerable ambivalence in how different societies and cultures relate to the consumption of luxury goods. Thinly focused in the literature are Islamic societies (with rapidly emerging ‘super-rich’ consumer segments) where the concept of luxury may be in tension with religious values. Set against this background, this paper investigates how consumer values and motivation influence purchase intentions towards luxury goods. Based on a sample of 400 respondents drawn from Morocco and applying logistic regression models, the paper finds correlations between the intention to buy luxury goods, motivation and personal values. Paradoxically, the influence of religion appears to diminish as consumer affordability of luxury goods increase. Partly due to globalization of markets and impacts on consumer values, Moslems are not fundamentally different from western consumers with regard to predispositions towards luxury consumption. Potential impacts of religion on luxury consumption attitudes and personal values appear to be moderated by the global consumer culture. The results also show an important gender underpinning especially when considered alongside perceived gender biases in consumption decision-making in many Islamic countries. Regarding the nature of purchase behavior women were found to be more positively disposed to impulse purchasing of luxury goods compared to men while more educated people, generally, indicated a greater tendency towards rational than impulse buying decisions.