Merger of Yorkshire and Barnsley Building Societies

Commenting on the merger of Yorkshire and Barnsley Building Societies, Kevin Mountford, head of banking at moneysupermarket.com, said: "Despite various initiatives around the globe to kickstart the world economy, it's clear the full impact of the credit crunch hasn't filtered through - and we now see another case of consolidation within the building society sector.

"With Barnsley's precarious £10 million investment in Icelandic banks being cited as the main reason for the merger, it shows how vulnerable these smaller societies are. Events such as this, and those recently experienced by the Cheshire, can be enough to tip them over the edge.

"The building societies may portray this as a merger, but Yorkshire, as the UK's third biggest mutual, is clearly the dominant organisation and as such will be giving thought to the impact on customers and staff.

"Yorkshire's products tend to be more competitive, with leading savings and mortgage products, so customers should see no difference in this respect. However, despite keeping both brands, they will only have one banking licence. Savers in both societies should therefore consider moving their cash around if they have more than £50,000 invested between the two.

"The town of Barnsley is passionate about its society, so the decision to retain its brand and eight branches will be welcomed. That said, there will undoubtedly be some cost-cutting and the duplication of head office functions will be the first thing under the microscope."