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Virgin says it may sell via IFAs if Rock bid succeeds

Virgin Money says it may distribute its mortgage products through intermediaries if its bid to acquire Northern Rock plc and 600 Lloyds Banking Group branches is successful.

In November 2009, LBG agreed to sell as least 600 of its branches after it received taxpayer aid in 2008, while the Government has been looking at options to return Northern Rock plc to the private sector.

In January 2010, Virgin acquired regional bank Church House Trust for £12.3m to use as a platform to launch its retail banking proposition.

Virgin Group chairman Sir Richard Branson has reportedly assembled a £3bn fund to buy both the Lloyds’ branches and Northern Rock. A deal to buy the Lloyds’ branches alone would make Virgin Money the sixth-biggest high-street lender in terms of branch numbers.

A Virgin spokesman says: “Mortgage brokers and IFAs are massively important in terms of distribution in financial services. This is something we would look at in terms of our overall distribution strategy.”

London & Country head of communications David Hollingworth says: “Intermediaries have shown that they offer a controlled and effective distribution method to lenders that want to increase their volumes.”

Emba group sales and marketing director Mike Fitzgerald says: “Consumers are crying out for a change. Virgin is such a strong, vibrant brand and I think it will punch above its weight.”

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