The troubled building society, Dunfermline, is being taken over by Britain’s largest building society, Nationwide, after running up huge debts for which the taxpayer will pick up the tab.

The merger with Nationwide is part of a package that was announced recently by the Bank of England, and over five hundred employees of Dunfermline will now be transferred over to the Nationwide.

Many branches, assets, and prime mortgage loans have been taken over by Nationwide, and building society officials have said that it will be business as usual for the customers of Dunfermline.

The Prime Minister, Gordon Brown, said that Dunfermline was ‘author of its own mistakes’ when the level of debt was revealed. He said: ‘Let’s face facts. The Dunfermline building society is the author of its own mistakes: mistaken judgments, mistaken investments, mistaken policies. We have had to step in where the Dunfermline building society has failed, and we have stepped in in such a way that we can protect both the savers and give those people who depend on the building society for mortgages a way through for the future.’

The chairman of Dunfermline said that he was pleased with the fact that the building society was being saved but was disappointed that it did not get the government support that would have allowed it to remain as an independent operation.

He said: ‘I am hearing encouraging noises – yet to be confirmed – that Nationwide will do all they can to keep as much employment as they can in Scotland. I and my board have worked tirelessly to protect the members and the staff and we have no reason to feel bad about this. We are deeply disappointed with the Government’s decision. It was unnecessary. But nevertheless we need to move on and we need to work with the new owners.’