AT least five building society names will disappear from the high street next year as mutuals merge to become more competitive, it was predicted today.
Deloitte believes 2007 will see a number of smaller societies being swallowed up as financial institutions are forced to get leaner and smarter to survive.
Experts from the business advisory firm said societies needed to react to the "stark reality of the challenge facing them" and focus on their customers to ensure the independent mutual sector is to continue.
By the end of this year, three building societies disappear - the Mercantile, Universal and Lambeth - following mergers with Leeds Building Society, Newcastle Building Society and Portman Building Society.
Next year Portman itself is set to go after a likely merger with Nationwide.
Stephen Williams, head of the building societies team at Deloitte, said: "In the wake of Nationwide's takeover of Portman Building Society, we predict a further five mergers in 2007, as struggling building societies look for 'white knight' mutual merger partners.
"Conversely, the larger building societies will be looking to mergers to increase scale, reduce the cost of funding and acquire key capabilities and assets to leverage across their business."
The number of building societies has dwindled over the past two decades.
In 1986 there were 151, but the figure almost halved within the space of a decade to 77.
This number fell to 63 in 2005 with this year's mergers reducing the figure to 60.
