A major high street bank could vanish from UK high streets after Santander agreed to buy it for £2,650,000,000.
TSB, which was previously part of Lloyds, has around 175 branches in the UK and approximately five million customers.
Sabadell, the Spanish owner of TSB, said last month it was considering a sale of the UK business amid efforts to stop itself from being subject to a hostile takeover.
Now, Santander has said it intends to integrate TSB into the company, but the deal first needs to be agreed at a shareholder vote.
The move would create the UK’s third-largest bank by the number of personal current accounts.
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Both lenders have cut their number of sites in recent years, as many customers have shifted to online banking.
The deal would raise fears of further job cuts and branch closures across the combined group.
Santander told analysts it plans a ‘rationalisation’ of the overall branch network and structure, with the aim of looking at ‘overlaps’ involving properties.
It comes a decade after Sabadell bought TSB for £1.7 billion to gain a foothold in the UK, a year after Lloyds had spun off TSB in a stock market float.
Marc Armengol, TSB chief executive, said: ‘TSB is a truly special bank, run by a first-class team that delivers trusted service and support for customers, day in and day out.
‘Today’s announcement represents the next exciting chapter for this successful business, as part of Santander, a highly regarded banking group. I believe this will prove to be an excellent fit for our loyal customers.’
Ana Botin, Banco Santander’s executive chairwoman, said: ‘The acquisition of TSB represents a continuing strategic commitment to our customers in the UK, offering a compelling opportunity that is financially attractive to our shareholders and aligned with Santander’s long-term objectives.
‘It strengthens our franchise in a core market through the acquisition of a low-risk and complementary business that adds to our diversification.’
What is TSB’s history in the UK?
Although many people still refer to Lloyds TSB, this is now well out of date.
Lloyds merged with TSB in 1995, and when they also took over HBOS plc in 2009, they became the biggest bank in the UK.
But in 2013, TSB was spun off to become a separate entity again in a stock market float.
And a year later, Sabadell bought TSB for £1.7 billion to gain a foothold in the UK.
Last month, TSB saw first-quarter profits nearly double, crediting cost-cutting and improved mortgage lending ahead of April’s stamp duty deadline.
The lender posted pre-tax profits of £101.3 million for the first quarter, up from £53.4 million a year ago.
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