Sainsbury’s Bank has confirmed it will launch back into the mortgage sector next year.
Last week, Money Marketing revealed Sainsbury’s had been in talks with distribution partners and was nearing a return to the sector after a 12-year absence.
In its preliminary results, published today, it said: “Given the Bank’s strong trading performance and the trust people have in the Sainsbury’s brand, we have decided to launch new mortgage products in 2017. We believe these products will complement our existing financial services portfolio and we expect customers to respond well.”
Sainsbury’s says it expects future operating profit to be around 10 per cent lower year-on-year due to the “investment required to enter the mortgage market”.
The retailer made a pre-tax profit of £587m in the year to 12 March, down 13.8 per cent year-on-year.
Last April the bank brought in Colin Snowdon as a consultant to investigate a possible launch into mortgage lending. Snowdon brought Aldermore to market and was chief executive of specialist lender and Merril Lynch subsidiary Wave Mortgages before it stopped lending in 2008.
Earlier this month Sainsbury’s rival, Tesco Bank, entered the broker market.