THE Irish Nationwide may have converted from building society to bank by the end of the summer, but its members will have to wait considerably longer to pocket the demutualisation windfalls, expected to average ?7,000 each.

New legislation to be unveiled next month is expected to provide for a brief window during which building societies could convert to banks free from the obstacles that have stymied the demutualisation efforts of Nationwide managing director Michael Fingleton.

Because the window may be open for as little as 28 days, it is expected that Fingleton will concentrate on demutualisation first and seek a buyer for the Nationwide later. The short window will also shut out carpetbaggers at the Educational Building Society, which wants to preserve its mutual status.

Industry sources say the sale of the Nationwide could be complicated by Fingleton's close involvement with the building society. Having managed the building society for more than 30 years, he is due to retire shortly. The Nationwide is a highly profitable lender but potential buyers would seek clarification on equity stakes taken in commercial property ventures.

A Nationwide spokesman was unable to confirm if members would be asked to vote on a demutualisation motion at the annual general meeting in April. But rebel members plan to use the meeting to push for reforms in the way the building society is run.

Accountant Brendan Burgess, a long-time critic of Fingleton's management, is seeking election to the board of the building society. He is also pushing for greater protection for customers who have used their homes as collateral for commercial mortgages.

The new legislation is Fingleton's last chance of securing the Nationwide's future before he retires. Building societies that avail of the proposed demutualisation window will be free to be acquired immediately by larger banks, by-passing the existing takeover immunity that locks them into a fiveyear limbo after abandoning their mutual status. Fingleton has lobbied hard for the removal of takeover immunity because, unless a former building society is immediately sold or floated on the stock market, members cannot gain financially from abandoning mutual status.

But it is understood that the Department of Finance is unwilling to scrap all barriers to conversion because this would expose other building societies such as the EBS to intense pressure from carpetbaggers seeking demutualisation windfalls.

This has led it to propose the demutualisation window during which the Nationwide could make a fast-track conversion to bank status.

The window could remain open for 28 days after the new legislation is enacted.

This is scheduled to happen before the Dáil's summer recess, so that the Nationwide may have converted to a bank by the end of the summer.