Uk's banking giant, Nationwide has announced plans to improve its financial position.

The lender will strengthen its balance sheet by up to £500 million for bossting its position. The largest building society in the UK has created a new type of shares that allows it to raise money without loosing its mutual status. The lender will be able to raise money from external investors without compromising on its status.

Regulator, Prudential Regulation Authority (PRA) had said earlier this year that it should hold more capital as a buffer against financial crisis and has asked the lender to boost its financial position. The group is also required to raise its leverage ratio to 3 per cent by the end of 2015.

The lender's performance has been strong and the group recorded an impressive 155 per cent surge in half-year profits to £332 million. The mutual cannot issue shares to raise capital like banks and is thus issuing new type of shares to boost finances.

Graham Beale, chief executive of Nationwide, said it will "contribute to the sustainability of our business and will strengthen our ability to act as a compelling alternative to the banks".