Vernon Building Society shares many positive aspects with its hometown football club, Stockport County. Most importantly, the couple care deeply about their communities.
The football team currently occupies a place in the First Division. Owned by successful property developer Mike Stott, who was born in nearby Hazel Grove, the Hatters are able to welcome supporters, young and old.
Last month, they beat the boys in an FA Cup tie away to Brackley Town – a match they won 3-1, securing a third-round tie against first-team club Crystal Palace in the New Year .
And as Ian Ladyman, my sports colleague at the Daily Mail, said recently, it’s not just one thing. During the home game against Bolton last month, the club organized pre-match and half-time entertainment for the children.
To illustrate this, Manchester United, just ten miles from Stockport’s Edgeley Park stadium, are charging children £66 to watch a Premier League game. Too bad – Stockport’s starting price for children’s tickets at yesterday’s home game against Exeter was just £2.
Vernon shows how his community bends in other ways. Outside of Stockport, there are branches where there are no other banks or building societies – Poynton, Cheshire, and Reddish, Greater Manchester.
Caps: Stockport County estate, with Vernon Building Society owner Steve Fletcher, right
Although its Bramhall branch is the last bank or community building branch standing, there is a bank office (a community bank) operated by the Post Office. In Hazel Grove and Marple, it competes with NatWest and Nationwide.
Steve Fletcher, chief executive of Vernon, is to quit in 12 days. But he says his seven-year stint with the building society was the happiest of his career in Birmingham Midshires (in taken over by Halifax), Clydesdale and Yorkshire Banking Group (now Virgin Money, part of Nationwide) and Woolwich (purchased by Barclays).
When Fletcher joined Vernon in early 2018, the building community was in turmoil.
‘It’s not new,’ he told me last week. ‘It’s not the way he treats customers and staff. The manager must also confirm that the business is sustainable.’
Fletcher set out to save Vernon. The society’s boardroom was renovated and made more ‘professional’.
But the most important thing is to be able to grow the assets of the side of the mortgage business. Unlike many big brokers, who now use computer programs to write loan applications (and give borrowers a thumbs up or thumbs down), Fletcher decided to take a different approach.
Loans are now written individually, allowing the community to lend to borrowers who would otherwise be given the cold shoulder by most other lenders. The result is a mortgage book of £500 million, compared to £290 million when Fletcher joined Vernon.
The six branches have been transformed (the one in Marple will reopen just before Christmas), and although books will remain an important part of its offering (‘Patrons love them’) , all accounts can be managed online.
‘When I was at Clydesdale and Yorkshire Banking Group,’ says Fletcher, ‘I was responsible for axing branches, sometimes leaving a town without a bank. It’s all about cutting costs and keeping shareholders happy. Here, it’s about making choices for customers. Everything we do is about doing the right thing, whether it’s donating to non-profit groups or charities.’
Vernon doesn’t earn much (£2.2 million last year), but it’s a lot. Earlier this year, he celebrated his 100th birthday.
Hopefully new owner Darren Ditchburn will do his best to keep Vernon in the communities he lives in like the Hatters in Stockport.
Long-term loans are still strong
Happy birthday to investment funds JO Hambro Capital Management (JOHCM) UK Equity Income and Law Debenture.
JOHCM UK Equity Income, a fund of £1.7 billion, has just celebrated its 20th anniversary, when Law Debenture marked its 135th weekly on Monday at the home of the London Stock Exchange near the building church of St. Paul.
Both funds are of interest to investors. JOHCM UK Equity Income has outperformed the FTSE All-Share Index over the past one, three, five and ten years, with directors Clive Beagles and James Lowen confident that May 2025 be a good year.
In their latest statement, they say that they can produce a growth rate for next year of more than five percent. They are also happy that most of his 60-odd holdings are ‘buys’.
As the base rate declines, the year-over-year annualized yield of around 5.1 percent looks encouraging.
Debenture Law also focuses on UK income shares, albeit differently. Although around 80 per cent of its assets are invested in listed funds (mainly UK companies) managed by investment house Janus Henderson, the rest is held by unlisted financial institutions. called Independent Professional Services (IPS).
IPS has several strands to its bow, providing custodian services to company and business pension funds – as well as a company secretarial facility. It generates high profits and increases its ability to pay shareholders an attractive cash flow.
Charity ditched by NI tax raid
A few days ago I went to a local charity, the Wokingham and District Association for the Elders (Wade).
Philip Mirfin, chairman of the charity’s trustees, took me on a tour of the Wade site and explained the vital role it provides to the many elderly people living in the Berkshire town.
‘We love a little but we have to,’ he explained. ‘We offer day care to the over 60s – where they can be fed, pampered and meet other people.
‘They are loved and feel less lonely. If they stay with the family, they will have a break for the family.’
There is no organization in Wokingham that offers the best services for older people. However, like many nursing homes and hospitals, Rachel Reeves attack on National Insurance Wade was really affected.
Mirfin says with the lower rate – but after the increase in employment allowance, which small employers can use to reduce their NI costs – Wade’s NI costs will increase by £27,000 and last year.
It’s not great on the surface, but when Wade spends more on the daycare he provides (£578,846 last year) than he earns (£513,615).
Like many charities up and down the country, Wade provides a vital service at a time when social care is in crisis in this country.
Surely, Reeves’ NI attack wasn’t meant to include them?
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