UK regulators approve CYBG’s takeover of Virgin Money
CYBG and Virgin Money to become one
UK’s Financial Conduct Authority (FCA) and Prudential Regulation Authority (PRA) have given a green light to the merger of CYBG and Virgin Money.
CYBG is acquiring Virgin Money in a £1.7 billion deal, which will create the UK’s sixth largest bank.
It has been already approved by the shareholders.
CYBG has also licensed the Virgin trademark from Richard Branson’s Virgin Group, with the view to combine the operations of both banks under this brand. The CYBG-owned brands, such as Yorkshire Bank, Clydesdale Bank and B (a mobile banking service launched in spring 2016) will disappear. Retail customers will be the first ones to be moved.
The combined entity will be using CYBG’s technology (migrated in phases over 36 months), including its long-standing core banking system supplied by FIS, a digital platform developed by CYBG for its B app, and a microservices architecture layer.
It will have:
- six million customers;
- £83.5 billion assets (double size of any current UK-based challenger bank);
- £70 billion of customer loans, including £58 billion mortgages;
- complementary products – both do current accounts but CYBG has SME lending and business current accounts whilst Virgin has credit card business;
- projected £120 million of annual pre-tax cost synergies by 2021.
