Private equity firm JC Flowers has stepped in to help the embattled building society sector by setting up a rescue deal for Kent Reliance.
The move comes as the Nationwide calls time on any further deals with rival building societies after coming to the rescue of three of its smaller competitors during the financial crisis, according to The Independent.
JC Flowers is preparing a lifeboat deal to help Kent Reliance Building Society that will be formally unveiled later this week.
The American firm and Kent will each inject £50m into a joint venture that will house all the building society's loans and deposits in an attempt to shore up its weakened capital position, reports the Telegraph.
Kent will retain a controlling 50% stake in the vehicle, which will be legally classified as a bank.
Building societies have been hamstrung in the financial crisis as bad debts and the soaring cost of funding dented profits and left them little option but to shrink their loan books.
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