SPANISH bank Santander has completed a €3 billion takeover of UK lender TSB in a deal that marks one of the largest shifts in European retail banking in recent years.
The purchase sees Santander UK take control of TSB from its previous owner, Spanish banking group Sabadell, following approval from regulators in both the UK and the EU.
The final value of the deal is reported at about €3.3 billion once final adjustments are included.
Serving close to 28 million customers in the UK, the combined business is set to become the country’s third-largest provider of current accounts and the fourth-largest mortgage lender, strengthening Santander’s position in a highly competitive market.
Nicola Bannister, TSB’s new chief executive as of Friday, told the Independent: “Today marks a significant new chapter for TSB as we become part of Santander.
“I look forward to leading TSB as we combine the very best of these two great businesses.”
Santander has said the aim of bringing TSB into the group was to increase scale and make savings of more than €400 million by combining operations and systems.
This is expected to include some branch and back-office changes as the two banks are merged, although this will happen gradually.
For Sabadell, the sale marks its exit from UK retail banking. The Spanish group will use the proceeds to strengthen its balance sheet and return value to shareholders, sources have said, including through a planned dividend.
Santander has stressed that, for customers, there will be no immediate changes. Accounts, cards and day-to-day banking services will continue as normal during the integration process.
The deal is part of a wider trend of consolidation in European banking, as major lenders look to simplify their operations and focus on core markets such as the UK.
Click here to read more Business & Finance News from The Olive Press.
