26 November 2015

Direct Line and Intelligent Finance on the block in UK banking shake-up

03 November 2009  |  11219 views  |  0 London  Bridge

The shake-up in UK financial services resulting from the state-backed bail out of Royal Bank of Scotland and Lloyds Banking Group will see the sale of telephone insurance operation Direct Line and Internet bank Intelligent Finance and a wholesale restructuring of the UK's branch banking network.

Negotiations between the distressed high street banks, the UK Government and the European Commission have culminated in a programme of forced disposals designed to inject fresh competition into the UK banking market.

Under the conditions outlined by the authorities, Royal Bank of Scotland will be forced to dispose of its insurance operations and resurrect its old Williams & Glyn brand to house 312 business banking branches, including all RBS branches south of Scotland and the NatWest outlets north of the border. The bank must also sell off its Global Merchant Services unit, which handles over five billion card transactions a year.

Lloyds Banking Group has been instructed to offload former high street acquisitions Cheltenham & Gloucester and TSB, and the Intelligent Finance internet bank inherited from HBOS.

The UK Government says it will not allow the disposed businesses to be hoovered up by the counry's bigger banks, but instead wants to offload the restructured businesses to smaller competitors and new entrants.

News of the restructuring programme came as Royal Bank of Scotland announced plans to axe 3700 front line branch staff in a bid to cut costs. The cuts will remove a 14% chunk of the bank's staff wage bill and hit a third of its branch banking staff.

Comments: (0)

Comment on this story (membership required)
Log in to receive notifications when someone posts a comment

Finextra news in your inbox

For Finextra's free daily newsletter, breaking news flashes and weekly jobs board, sign up now.

Related stories

26 October, 2009
02 October, 2009
25 August, 2009
24 July, 2009
16 July, 2009
30 June, 2009
09 June, 2009
03 June, 2009
22 May, 2009
21 May, 2009
07 April, 2009
10 February, 2009
19 December, 2008
03 November, 2008
02 October, 2008

Related company news


Who is commenting?

Top topics

Most viewed Most shared
MIT to run fintech degree course
9066 views comments | 35 tweets | 14 linkedin
Coinbase issues Bitcoin debit card
8029 views comments | 16 tweets | 21 linkedin
UK banks hardest hit by non-bank money tra...
7865 views comments | 27 tweets | 30 linkedin
Apple Pay users given a free ride in Londo...
7860 views comments | 21 tweets | 29 linkedin
BBVA buys 29.5% stake in Atom for £45...
6871 views comments | 33 tweets | 40 linkedin

Featured job

Competitive Package
New York City, NY. USA

Find your next job