NATIONWIDE BUILDING SOCIETY

AGM Information • Jun 19, 2015

Notice of Annual General Meeting 11am on Thursday 23 July 2015

The Windsor Hall, Bournemouth International Centre, Exeter Road, Bournemouth, Dorset BH2 5BH

Your opportunity to consider and vote on:

Ordinary resolutions

1. To receive the Directors' Report, the Annual Accounts, the Annual Business Statement and the Auditors' Report for the year ended 4 April 2015.

See the Summary Financial Statement in the Review of the year leaflet for a summary of these items. Our full Annual Report and Accounts will be available at nationwide.co.uk from 17 June 2015. From 19 June 2015 there'll be copies in all our branches or you can ask us to send you one by writing to the Group Secretary, Nationwide Building Society, Nationwide House, Pipers Way, Swindon SN38 1NW.

1. To approve the Directors' Remuneration Report for the financial year ended 4 April 2015, as set out in the Annual Report and Accounts for the year ended 4 April 2015.

We ask you to approve the Directors' Remuneration Report. The vote is advisory and the Directors' entitlement to remuneration doesn't depend on it. A summary of the Directors' Remuneration Report appears in the Review of the year leaflet. A full version appears in the Annual Report and Accounts and at nationwide.co.uk

1. To approve the re-appointment of PricewaterhouseCoopers LLP as Auditors until the end of the next AGM.

Special resolutions

• 1. To consider and, if thought fit, pass a Special Resolution to amend the Memorandum of the Society in the way set out in part (a) opposite.
• 1. To consider and, if thought fit, pass a Special Resolution to amend the Rules of the Society in the way set out in part (b) opposite.

A description and the full text of the proposed Memorandum and Rule changes are set out opposite.

The election or re-election of your Society's Directors

To consider and if thought fit, to:

• 6. elect David Roberts
• 7. re-elect Graham Beale
• 8. re-elect Rita Clifton
• 9. re-elect Mitchel Lenson
• 10. re-elect Lynne Peacock
• 11. re-elect Roger Perkin
• 12. re-elect Tony Prestedge
• 13. re-elect Mark Rennison
• 14. re-elect Chris Rhodes

All Directors on the Board at 4 April 2015 are standing for election or re-election apart from Geoffrey Howe and Michael Jary who are both standing down at the end of this year's AGM. Your Board recommends that you vote 'For' each of the Directors. More information about the Directors can be found on your.nationwide.co.uk/agm The Chairman confirms that all the Directors seeking election or re-election continue to be effective with a strong commitment to the role.

By order of the Board

Simon Waite, Group Secretary, 15 April 2015

Voting

You can vote online or by post. You can vote online at nationwide.co.uk/agm until 11am on Monday 20 July. Postal votes must be received by the independent scrutineers Electoral Reform Services (ERS) at The Election Centre, 33 Clarendon Road, London, N81 1ER before 11am on Monday 20 July. You may also vote in person at the AGM or appoint a representative (who doesn't have to be a member) to attend and vote in your place. You can also tell them how to vote at the meeting. If you'd like to do this, just follow the instructions on your voting form or at the online voting site.

Nationwide Building Society.

Head Office: Nationwide House, Pipers Way, Swindon, Wiltshire SN38 1NW. nationwide.co.uk

Memorandum and Rule changes

Resolution 4 in the Notice of AGM is a Special Resolution to change the Memorandum of the Society and resolution 5 is a Special Resolution to change the Rules of the Society.

(a) What are the changes we want to make to the Memorandum?

The Memorandum sets out the Society's purpose and powers. Currently, it prevents the Society from creating a floating charge over its assets. It contains this restriction because the Building Societies Act 1986 prevented societies from creating floating charges. However the law has now changed to allow societies to create floating charges should they wish to do so. We are therefore proposing a change to the Memorandum to remove the current restriction.

Why will this help?

A floating charge is a form of security which is given over a changing, rather than static, pool of assets. Having the ability to create a floating charge may be useful in relation to the Society's treasury activities and could help to reduce funding costs for the Society.

Any other changes?

As a separate minor change, the Memorandum contains a reference to an out of date section of the Companies Act 1985 which is also being updated.

The proposed changes to the Memorandum are set out below. The new wording is set out in italics and underlined. Those terms which are defined in the Memorandum appear in bold.

Proposed Memorandum changes

To delete from the definition "dispose (or disposing)" in paragraph 6 "(except by way of floating charge)".

To delete from the definition "parent undertaking" in paragraph 6 "section 258 of the Companies Act 1985" and to add in its place "section 1162 of the Companies Act 2006".

(b) What are the changes we want to make to the Rules?

The Rules set out the principles and basis on which the Society is governed and define how membership of the Society is determined. Generally, if you have a mortgage with the Society, you will be a borrowing member. Currently, where someone has a mortgage with a subsidiary of the Society, they are not a borrowing member. If the benefit of their mortgage were to be transferred to the Society, however, they would, under the current Rules, automatically become a borrowing member of the Society. The Rule change which is proposed would give the Society the power, but not the obligation, to confer membership in this situation.

The proposed changes to the Rules are set out below. The new wording is set out in italics and underlined. Those terms which are defined in the Rules appear in bold.

Proposed Rule changes

To delete existing Rule 7(c) and to add a new Rule 7(c) which will state: "A person is a borrowing member while he owes the Society money on a mortgage loan, where:

• (i) he owes the money to the Society directly; or
• (ii) he owes the money to another person who holds the benefit of the mortgage loan for the Society and the Society, at its discretion, decides to offer membership to him which he accepts upon such terms as the Society may specify."

To add a new Rule 7(d) which will state:

"A person will cease to be a borrowing member when he no longer owes the Society money on a mortgage loan (whether directly or to another person who holds the benefit of the mortgage loan for the Society, as contemplated in Rule 7(c)) or where the Society or the other person:

• (i) takes possession of, or exercises a power of sale in relation to, the whole or any part of the land on which the loan is secured; or
• (ii) obtains an order for foreclosure absolute or, in Scotland, foreclosure in respect of the whole or any part of that land."

To renumber existing paragraphs (d), (e), (f), (g), (h) and (i) of Rule 7 as (e), (f), (g), (h), (i) and (j).