In December 2008, the British government announced a change in private-sector financial support.



  • 1 harmful
  • 0 neutral
  • 0 liberalising


the letter from the EC to the UK - Brussels, 25.1.2010 C(2009)340 final -

Inception date: 30 Mar 2009 | Removal date: open ended

Capital injection and equity stakes (including bailouts)

Dunfermline Building Society is a financial services institution based in the UK. Established in 1869, it is the largest Scottish building society and the fourteenth largest building society in the UK, with 231,136 members as of December 2007 and a network of 34 branches and 37 agencies. As of 31 December 2008, Dunfermline had a balance sheet total of Ł3.3 billion and posted a loss after tax over 2008 of Ł25.8 million.
Dunfermline's main retail products and services include savings (e.g. instant access saving accounts, children's bond, ISAs1), investments (e.g. equity-linked bonds and pensions), mortgages and general insurance products (e.g. home and contents insurance). Dunfermline also offers financial advice, personal loans, credit cards, foreign currency as well as equity release mortgages for its older members.
State resources are involved, in particular regarding the working capital facility of Ł10 million for the Rump Dunfermline, the liquidity facility of Ł'170-220' million to keep the social housing portfolio in business until its sale to Nationwide and the HMT cash contribution of Ł1.555 billion in order to match the liabilities comprised in the Transfer Package.
The Commission concluded that the measure contains state aid and gave the following assessment:
" Given that Dunfermline is an undertaking active in the financial sector, which is open to intense international competition, the Commission considers that any advantage from State resources to Dunfermline would have the potential to affect intra-Community trade and to distort competition." (par. 41 of the letter from the EC to the UK - Brussels, 25.1.2010 C(2009)340 final)

A state measure in the GTA database is assessed solely in terms of the extent to which its implementation affects the extent of discrimination against foreign commercial interests. On this metric, the state aid proposed here is discriminatory.