Tesco Bank flogs mortgage portfolio to Lloyds
Tesco Bank has confirmed the sale of its mortgage portfolio to Lloyds Banking Group for £3.8bn.
The deal will see Tesco’s 23,000 plus mortgage customers move across to LBG’s Halifax brand in a deal that will add an additional £3.7bn lending balance to its books.
Gerry Mallon, Tesco Bank chief executive, said:“In May we announced our decision to stop new mortgage lending while we explored our options to sell the mortgage book.
“Our focus is on how we best serve Tesco customers and align our resources effectively to their needs while ensuring that our offer remains sustainable in the long term. As a result, we made the decision to move away from our mortgage offering.
“Our priority throughout has been to complete a commercially acceptable transaction with a purchaser who will continue to serve our customers well.
“After a thorough process, we are pleased to confirm that we have agreed the sale of our mortgage book to Lloyds Banking Group, operating under the Halifax brand. We are confident that they will continue to provide our customers with an excellent customer experience.”
The customer accounts will transfer to Halifax once necessary transitional arrangements have been delivered and it is anticipated that beneficial ownership will transfer at the end of September 2019 with legal title occurring by the end of March 2020.
The portfolio generated directly attributable pre-tax profits of £9.1m in the 2018/19 financial year.