Where to now?

Commenting on Moody's downgrading nine building societies, Kevin Mountford, head of banking at moneysupermarket.com, said; "Building societies can no longer claim the moral high ground over banks.

"Banks have faced fierce criticism regarding exposure to toxic debt and over leveraging, but following successive collapses, mergers, and now this verdict from Moody's, it seems building societies are not the safe bet they were once thought of.

"Many people will understandably worry about the safety of their cash if it is held in the downgraded building societies, but they shouldn't panic. Moody's, along with other rating systems, is currently going through a realignment process, in order to ensure the current state of the financial system is thoroughly accounted for in their ratings. The downgrading of these building societies can be seen as part of this process.

"However, it is a surprise that Nationwide is one of those building societies being downgraded. This behemoth of a building society is often considered a real safe haven; indeed resent moneysupermarket.com research found the British public considered Nationwide to be the safest place for their money - whether or not this will continue to be the case remains to be seen.

"Customers of these building societies, and in fact of any financial institution, should ensure they don't have more than £50,000 of savings saved with one single provider, as any sum over this limit is not guaranteed by the FSCS."