Building societies need to build on their "extraordinary" past to maintain their edge over high street and challenger banks, according to the chief executive of the Building Societies Association (BSA).
Speaking at the BSA's annual conference in London, Robin Fieth evoked the business models of the early mutuals to demonstrate the values that could help the sector to grow in the future.
Mr Fieth described the implicit trust involved in the early building societies' business models, where the last in the queue waiting to be housed "trusted their fellow members to keep on contributing until the last member's house was bought".
"I want to see that extraordinary function as a starting point," he explained.
He added that building societies have succeeded in growing their share of the mortgage market, providing a vital boost to first-time buyers that may otherwise have been unavailable.
"Better rates and better mortgage deals have not come at the expense of weaker capitalisation," Mr Fieth said, adding "while banks have been shedding staff, building societies have been maintaining and growing their staff".
Emphasising the role building societies could play in supporting their communities, the BSA chief executive cited the example of Newcastle Building Society, which opened a branch in a library in Yarm and helped to preserve it for the use of local people.
He also pointed to the queues that greeted the opening of a new Nationwide in Glastonbury following the closure of the town's branches of Lloyds and Barclays as evidence for strong demand for building societies' services.
"We have an extraordinary past and want an extraordinary future," he said, adding that mutuals could be "a force for good in financial services".
simon.allin@ft.com
