THE former chief executive of the Portman Building Society has received a reported £1.7 million pay-off after the merger with Nationwide.

Nationwide defended the payment, saying it was in line with the 58-year-old's contract.

It brings total boardroom "goodbye payouts" from the deal to £5.1 million, after three former Nationwide directors received £3.4 million in the summer.

That pay-off was described as "sending out the wrong message" by the Investors Association.

Robert Sharpe received a redundancy payment of £709,000 and £977,000 in return for foregoing his 12-month notice period.

One former Portman customer, Alan Coldicott, 76, from Southbourne said the pay-off was ludicrous and it showed that the merger had been a "gravy train".

The Portman members who voted over the merger were 93 per cent in favour - though branch closures and long queues to cash in the windfall payments upset some people.

A Nationwide spokeswoman said: "Robert got only what he was entitled to and that was in accordance with his contract.

"You also have to remember he was made redundant so the money reflects his severance pay.

"Under Robert's stewardship Portman performed extremely well. If you look at the statistics for the year proceeding the merger, the profits were up 23 per cent."

Portman paid out a minimum of £200 from the merger to 1.2 million out of its 1.8 million customers.

Some landed windfalls of up to £1,000, but the average payout was £445.

The merger created the second-largest domestic mortgage lender, with more than 900 branches and 13 million members.