HBOS has bought an additional 5 per cent of the shareholding in Sainsbury’s Bank for £21m bringing its total ownership to 50 per cent.
Sainsbury’s Bank which began trading in February 1997 is now a 50:50 joint venture between HBOS and J Sainsbury.
Previously, the ownership structure was 55 per cent Sainsbury’s and 45 per cent HBOS.
The change in ownership follows a business review jointly carried out by both companies.
The Board of Sainsbury’s Bank will comprise of eight directors – three directors from HBOS, three from Sainsbury’s and two executives from Sainsbury’s Bank.
HBOS Retail chief executive Benny Higgins will be the new chairman for a period of two years.
J Sainsbury’s chief financial officer Darren Shapland will then assume the role.
Sainsbury’s Bank provides a range of financial products including insurance, credit cards, savings and loans. The Bank has access to over 16 million customers per week through the 780 Sainsbury’s stores across the UK.
Higgins says: “Sainsbury’s Bank has strong customer loyalty. The business has demonstrated it can acquire and retain customers very effectively. There is significant potential to grow the business. We aim to do just that.”
Shapland says: “We are committed to growing the Bank’s business and are increasing our presence in the financial services sector. The Bank’s chief executive, Rob Walker, is streamlining the operational structure and developing a broader business plan. The sale of our five per cent for £21 million demonstrates the value of the Bank and a 50:50 structure reflects the continued commitment of both shareholders’.”