NatWest Group plc has signed a deal today to acquire Sainsbury’s Bank’s retail banking assets and liabilities and its 1m customer accounts for £2.5bn.
NatWest, which is just under 30% owned by the government, expects to acquire £2.5bn of gross customer assets from Sainsbury's Bank.
The assets include £1.4 billion of unsecured personal loans and £1.1 billion of credit cards balances, together with approximately £2.6 billion of customer deposits.
The deal marks the latest exit of the supermarkets and retailers from retail banking and financial services. Tesco sold its banking arm to Barclays in February in a £700m deal.
NatWest Group will executive the deal through its subsidiary National Westminster Bank plc.
The takeover is subject to court sanction and regulatory approval and is expected to be completed during the first half of 2025 if approvals are agreed.
Sainsbury’s Bank ATMs, insurance and travel money arm and its Argos Financial Services subsidiary are not included in the deal.
NatWest says there there is no immediate change for its new customers and they will be contacted in due course.
Paul Thwaite, NatWest Group CEO, said: “Following today’s announcement, we look forward to welcoming new customers to NatWest Group, where they will benefit from our expertise and award-winning digital banking offering. This transaction is a great opportunity to accelerate the growth of our Retail Banking business at attractive returns, in line with our strategic priorities.
"As well as a complementary customer base, the transaction is expected to 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.”
Simon Roberts, Sainsbury’s CEO, said: “I am pleased to be announcing this news today. 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.
"There will be no immediate change for our bank customers as a result of this announcement. Today’s news means we will focus all our time and resources going forward on growing our core retail business, delivering great quality and value, week in week out.”