Tesco Bank confirms sale of mortgage portfolio to Lloyds Banking GroupChristian Fernsby ▼ | September 3, 2019
Tesco Personal Finance (Tesco Bank) confirmed the sale of its mortgage portfolio to Lloyds Banking Group for a cash consideration of c. £3.8bn.
Britain Tesco Bank
Topics: Tesco Lloyds mortgage
The mortgage portfolio has a lending balance of c. £3.7bn and generated pre-tax profits of £9.1m in the 2018/19 financial year.
As part of the sale the entire residential mortgage portfolio and arrangements for the ongoing administration will transfer to Halifax, a Division of Bank of Scotland plc, a wholly owned subsidiary of Lloyds Banking Group.
The customer accounts will transfer to Halifax once necessary transitional arrangements have been delivered.
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 sale is in line with Tesco Bank’s strategy of focusing on a reduced number of products and services that serve the broad range of Tesco customers, and will reduce operating and funding costs.
The sale proceeds will be used for re-investment into our customer offer, ongoing transformation of the business and re-balancing of retail and wholesale funding sources given the reduction in overall lending. ■