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Santander scraps UK bank brands | |
(about 2 hours later) | |
Spanish banking giant Santander is to rebrand all of its major UK High Street brands - Abbey, Alliance & Leicester and Bradford & Bingley. | Spanish banking giant Santander is to rebrand all of its major UK High Street brands - Abbey, Alliance & Leicester and Bradford & Bingley. |
A total of 1,300 branches will have their names changed to Santander by the end of 2010, in a £12m move. | |
Any customer of Abbey, Alliance & Leicester or Bradford & Bingley savings will be able to carry out transactions in any of Santander's UK branches. | |
Santander is the second-biggest banking group in the world after HSBC. | Santander is the second-biggest banking group in the world after HSBC. |
'Trust' | |
It said it hoped to save about £180m by integrating the three businesses, and that the overhaul reflected the group's policy to operate under a single brand - which is already found in more than 40 countries. | |
Santander has already incorporated its flame logo into the Abbey branding, and it said that customer feedback suggested its brand would be welcomed in the UK. | |
"Customers trust us as a global brand and they feel very safe about their savings," said António Horta-Osório, chief executive of Santander's UK businesses. | |
"It's important for customers who travel around the UK to have 1,300 branches to transact with - and they will have the same product and the same people facing them in the branches." | |
The move would also allow the UK business to use the "expertise and product developments from Santander's global business," he added. | |
Abbey staff will be upset and there will be a potential loss of customers Leigh GoodwinBanking analyst | |
The first name changes will begin in June, with Abbey credit cards being rebranded, while the renaming of branches will begin next year, with Abbey and B&B first to be overhauled. | |
However despite the savings it anticipates making, banking analyst Leigh Goodwin said that the policy was a risk and, in his view, a mistake. | |
"Abbey has good value as a trusted brand in the mortgage and savings arena," he said. | |
"Staff will be upset and there will be a potential loss of customers." | |
Expansion | Expansion |
Santander is already a familiar brand outside the UK. | |
Santander gained a foothold in the UK banking market in 2004 after buying Abbey for about £8bn, in Europe's biggest cross-border bank takeover. | Santander gained a foothold in the UK banking market in 2004 after buying Abbey for about £8bn, in Europe's biggest cross-border bank takeover. |
The deal offered Santander control of Britain's second-largest mortgage lender, with 741 branches and 18 million customers. | The deal offered Santander control of Britain's second-largest mortgage lender, with 741 branches and 18 million customers. |
The Spanish bank saw further expansion opportunities in 2008, as some UK banks were severely threatened by the global financial crisis. | The Spanish bank saw further expansion opportunities in 2008, as some UK banks were severely threatened by the global financial crisis. |
It bought Alliance & Leicester in a £1.3bn deal aimed at reducing funding pressures on the UK bank and strengthening Santander's local business. | It bought Alliance & Leicester in a £1.3bn deal aimed at reducing funding pressures on the UK bank and strengthening Santander's local business. |
In September, the UK's biggest lender to landlords, Bradford & Bingley, was taken over by the government after the credit crisis had shut off its funding. | In September, the UK's biggest lender to landlords, Bradford & Bingley, was taken over by the government after the credit crisis had shut off its funding. |
Santander stepped in and paid £612m to take control of 197 Bradford & Bingley branches and £20bn in deposits. | Santander stepped in and paid £612m to take control of 197 Bradford & Bingley branches and £20bn in deposits. |
Bradford & Bingley still exists as an entity and is owned by the Treasury. | Bradford & Bingley still exists as an entity and is owned by the Treasury. |
Santander's specialist brands, including the internet bank Cahoot, will retain their identities. | |
Licences unchanged | |
UK banks owned by Santander currently operate under two banking licences. | |
One covers Abbey, Bradford & Bingley and Cahoot. The other relates to Alliance & Leicester. | |
This means that savers are 100% covered by the Financial Services Compensation Scheme for up to £50,000 across Abbey, B&B and Cahoot combined. In addition, they are also covered for up to a further £50,000 with A&L. | |
Santander says this will remain the case up until at least mid-2010, because Abbey and B&B are being rebranded first - meaning that A&L will still be running as a separate business under its own name and its own licence. |