The Co-operative Bank Acquires Sainsbury’s Bank’s Mortgage Portfolio in £464m Deal
The Co-operative Bank has reached an agreement to purchase Sainsbury’s Bank’s mortgage portfolio for £464 million. This deal marks a significant step for Sainsbury’s in simplifying its banking business, as the company had previously announced its decision to cease all new mortgage sales almost four years ago.
The negotiations for the deal had initially been terminated in the spring due to a failure to agree on a price. However, discussions resumed earlier this summer, leading to the successful agreement between the two firms.
Co-op Bank, which is now independent from the wider Co-operative Group, revealed that the acquired portfolio consists of approximately 3,500 customers with balances totaling around £479 million. The bank plans to transfer Sainsbury’s Bank customers to its platform over the course of one year to ensure a smooth transition process.
Nick Slape, the CEO of Co-op Bank, expressed his delight with the deal. He stated, “Once the transfer activity is complete, we look forward to welcoming the new customers who will benefit from our ambitious new technology platform. This platform will simplify our banking services, increase efficiency, and provide us with the flexibility to introduce new products and services.”
Slape also highlighted that this acquisition is the bank’s first portfolio purchase in over a decade, demonstrating the progress they have made in recent years and their strength in the competitive UK mortgage market.
Sainsbury’s Bank reported that the mortgage portfolio had generated approximately £4 million in profits during the last financial year. Jim Brown, the CEO of Sainsbury’s Bank, explained that the sale of the mortgage book aligns with their strategy to reshape their portfolio and focus on offering capital and cost-efficient, mobile-led financial services to their loyal Sainsbury’s and Argos customers.
This acquisition by the Co-operative Bank signifies a significant move in the UK banking sector and is expected to have a positive impact on both companies involved.
- The Co-operative Bank has agreed to acquire Sainsbury’s Bank’s mortgage portfolio for £464 million.
- Sainsbury’s Bank had previously announced its decision to stop all new mortgage sales.
- The negotiations for the deal were initially terminated in the spring but resumed earlier this summer.
- The acquired portfolio consists of approximately 3,500 customers with balances totaling around £479 million.
- Co-op Bank plans to transfer Sainsbury’s Bank customers to its platform over a one-year period.
- The CEO of Co-op Bank expressed excitement about the deal and the opportunities it presents for the bank’s technology platform.
- This acquisition is the Co-operative Bank’s first portfolio purchase in over a decade.
- Sainsbury’s Bank reported that the mortgage portfolio generated around £4 million in profits in the last financial year.
- The sale of the mortgage book aligns with Sainsbury’s Bank’s strategy to focus on mobile-led financial services.
Overall, this acquisition is expected to benefit both the Co-operative Bank and Sainsbury’s Bank, as they continue to navigate the competitive UK banking landscape and provide enhanced services to their customers.