Abbey National is selling its First National mortgage and unsecured lending business, which deals exclusively through intermediaries, to GE Consumer Finance, owner of sub-prime lender igroup, for £848m.
Abbey says First National operates largely independently of the group's other businesses, under its own brand and in different market segments where there were limited cross-selling opportunities.
The sale fits with Abbey's plans to sell off non-core businesses.
GE Consumer Finance says it will retain the igroup and First National brands, management teams, including First National managing director Philip George and salesforces, but cannot rule out job cuts among its 1,400 staff, saying this can happen with any acquisition.
It says that although both brands will be targeting many of the same brokers, they operate in different product areas, including First National's specialism in overseas timeshare finance.
The deal adds £4.8bn assets – £3bn secured and £1.8bn unsecured – to GE Consumer Finance in the UK.
GE Consumer Finance says both brands are committed to the intermediary market and this is a revenue enhancement exercise, not a cost-reduction move.
George says: “By combining the unique skills of our two companies, we will be able to create a UK consumer finance business that will provide unrivalled service to intermediaries and customers.”