Sainsbury’s sells core banking business to NatWest
British supermarket group Sainsbury’s is selling the personal loan, credit card and retail deposit portfolios of its core banking business to NatWest Group.
Sainsbury’s sells banking business to NatWest
The deal will see £2.5 billion of gross customer assets transferred to the high street lender, including £1.4 billion in unsecured personal loans and £1.1 billion in credit card balances, alongside around £2.6 billion in customer deposits.
As part of the transaction, which is expected to close during the first half of 2025, NatWest will take on around one million new customer accounts.
Sainsbury’s has been looking for a buyer for the business since January when it first announced its intention to wind down certain areas of its banking endeavours.
“NatWest’s values and customer focus are a close fit with ours and as one of the UK’s leading banks, NatWest’s scale and financial services expertise will ensure our existing financial services customers continue to be well looked after,” comments Sainsbury’s CEO, Simon Roberts.
Roberts confirms that there will be “no immediate change for our bank customers” as a result of the deal, which will enable the group to “focus all our time and resources going forward on growing our core retail business”.
As per the terms of the transaction, NatWest will receive “the gross customer assets and liabilities and associated cash at completion” with an agreed £125 million consideration to be paid by Sainsbury’s, which says it expects to return “at least £250 million” to shareholders.
Paul Thwaite, CEO of NatWest Group, describes the purchase as “a great opportunity to accelerate the growth of our retail banking business at attractive returns” that will “add scale to our credit card and unsecured personal lending business within existing risk appetite”.
“NatWest Group has a strong track record of successful integration, and we are focussed on ensuring a smooth transition for customers,” he adds.
