Yorkshire Building Society and Norwich & Peterborough Building Society (N&P) have agreed terms for a proposed takeover.

The merged building society would have combined assets in the region of £33.7 billion with three million members. The N&P name would be kept within the Yorkshire Building Society group.

The proposed merger - subject to N&P member and regulatory approval - is expected to complete in November.

Iain Cornish, chief executive of Yorkshire Building Society, said the N&P brand had similar values and was well regarded by members.

He said, 'We will build on N&P's strong brand and the value it has delivered to its members, while gaining the opportunity to consider developing our own products in areas where N&P has complementary capabilities and expertise, such as the current account market.'

Under the terms of the merger, all N&P brnaches will be retained for at least two years and will maintain an 'important operational presence' in Peterborough for a minimum of three years.

Yorkshire has said it will honour in full the compensation payments programme for holders of Keydata investment products.

A special general meeting will be held for members of N&P on 22 August where N&P members' approval to the proposed merger will be sought.

The announcement comes after N&P announced former Standard Life Bank chief Anne Gunther would become its new chief executive from 20 April.

N&P was this week fined £1.4 million for failing relating to the sale of Keydata products and has been forced to set aside £50 million in compensation provision.