The Board of Holmesdale Building Society is to merge with the Skipton, the UK’s fourth largest building society.

Subject to approval by its members and confirmation by the Prudential Regulation Authority (PRA), the merger is expected to become effective on I October 2018.

The Skipton has received consent from the PRA to approve the proposed merger by Board resolution.

The Holmesdale was founded in 1855. It has one branch, on Church Street in Reigate, and employs 26 people. Following a fundamental review of the current commercial and financial position Holmesdale’s Board has unanimously concluded that it is in the best interests of current and future members to merge with a much stronger building society able to offer more choice and value to members in the long-term.

The Skipton is committing to retaining a branch in Reigate for at least two years from the date of merger, after which it will be subject to the Society’s ongoing branch review process. There will also be no compulsory redundancies among designated branch staff as a result of the merger. Holmesdale members will be able to transact in any branch of the enlarged Society from the merger date.

Mike Kirsch, chief executive of Holmesdale Building Society, said: “We firmly believe that this proposed merger is in the best interests of our members. Without the merger we would not be able to continue to provide the same range of products or good value pricing to our members.

“We believe we can offer enhanced security by merging with a much stronger building society able to offer more choice and value to members in the long-term.

“A merger with Skipton will result in Holmesdale members having access to Skipton’s large national branch network, its online, post, telephone and financial advice offering, and to a broader range of attractive products and services – from the time when the merger becomes effective.”

David Cutter, Skipton’s group chief executive, added: “We have always made it clear that we would consider further merger activity where it is in the best interests of our members. We look forward to welcoming Holmesdale members on board and sharing with them our full range of financial solutions to help them plan for their life ahead.”