HSBC and other banking apps experience technical issues
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The supermarket chain is allegedly preparing to offload its banking division as part of a deal with private equity firm Centerbridge. This deal is apparently worth £200million and is expected to be announced in the next couple of weeks. Despite being the first country’s supermarket bank, Sainsbury’s has been looking to auction off its banking business over the past year.
The bank took full control of its banking division in 2013 after paying £260million to purchase a 50 percent shareholding from joint venture partner Lloyds Banking Group.
Back in 2019, Sainsbury’s Bank announced it was leaving the mortgage market in light of strong competition as a result of extremely low interest rates which damaged the profitability for smaller lenders.
Currently, the company has an estimated two million customers and offers a range of products and services, which include home insurance and savings accounts.
Bank: Sainsbury’s reportedly set to scrap bank (Image: GETTY)
Other products and services with the bank include loans, travel insurance, credit cards and Sainsbury’s own Nectar scheme.
Nectar members are rewarded with loyalty points when they spend at certain Nectar partners, including Sainsbury’s, Argos and Habitat.
Centerbridge is a US-based private equity group, which has various investments in the banking sector across both sides of the Atlantic.
According to Sky News, the firm is looking to buy Sainsbury’s Bank as a platform to purchase other banking operations in the UK.
As part of this deal, Centrebridge would acquire the bank outright and use the Sainsbury’s brand name as part of a licensing agreement with the supermarket chain.
News of this deal comes after various other UK supermarket chains have offloaded their banking divisions to cut costs.
Recently, Tesco Bank sold its mortgage business and confirmed it was removing itself from the current account market.
Bank:According to Sky News, Centrebridge is looking to buy Sainsbury’s Bank (Image: GETTY)
In light of these developments, many customers of Sainsbury’s Bank are rightfully concerned about how their accounts and services they have with the institution will be affected by this reported change.
How will customers be affected?
While news of the deal is expected to be announced soon, it is unlikely to happen in the near future and affect the day-to-day operations of the bank.
According to Sky News, Centrebridge wants to get into the UK’s banking market and use Sainsbury’s Bank as a foundation and starting point for doing this.
However, as the deal is not even confirmed yet, customers of the bank should wait for official announcements before making any decisions regarding their status with the institution.
As well as this, Centerbridge plans to keep the Sainsbury’s brand as the face of its services, so customers are unlikely to notice any change at face value.
Customers of Sainsbury’s Bank and investors in the supermarket chain are likely to find out the specifics of this deal in the coming weeks, if it comes to pass.
Express.co.uk has reached out to Sainsbury’s Bank for comment on this story.