The EBS Building Society has started the new year strongly. The only Irish society, which is adamant that it will remain a mutual, is close to taking over the Norwich Union Building Society.

On January 21st, qualifying members of the NUBS will vote on the offer from the EBS.

Qualifying savers have been offered a bonus of 1.5 per cent of the balances on their share accounts at September 29th. Savers qualify for the bonus if they held a share account (as opposed to a deposit or other savings account) with a balance of not less than £100 between July 1st, 1997 and January 21st, 1998.

If the takeover goes ahead, about 10,000 savers are expected to share a £1.7 million bonus. Mortgage holders do not get any bonus payment.

But there are other benefits for both NUBS savers and mortgage holders if the takeover goes ahead. They will be able to get higher interest rates on their savings and pay lower interest changes on their mortgages within three months of the takeover as members of the EBS.

As evidence of its commitment to passing on the benefits of mutuality to its members, EBS has consistently maintained higher savings rates and lower mortgage rates than those generally available in the market.

Currently the standard EBS mortgage rate is 7.1 per cent. This compares with the standard NUBS rate of 7.7 per cent.

So NUBS mortgage holders will see the interest rate on their loans fall.

EBS currently offers interest of 1.75 per cent on savings of up to £20,000, while NUBS pays 0.25 per cent on savings up to £10,000 and 0.5 per cent on sums of £10,000 to £50,000.

If the takeover is agreed, EBS will get a clean loan book of £83 million and assuming that the NUBS members leave their accounts where they are, some 14,000 new saver customers and 2,500 new borrowing customers.