U.K. grocery chain Sainsbury's to take full control of its Sainsury's Bank from Lloyds Banking Group.
Sainsbury’s Bank was the first supermarket bank in the U.K., established in 1997 as a joint venture between Sainsbury’s and Bank of Scotland. Its aim was to provide a range of financial services products to Sainsbury’s customers under the Sainsbury’s brand, leveraging the banking capabilities of Bank of Scotland, according to the retailer. The relationship was redefined in 2007 to be a 50/50 joint venture between Sainsbury’s and Halifax Bank of Scotland, which later became Lloyds Banking Group.
Over a 42 month period, Sainsbury's Bank will transition support and back office services away from Lloyds Banking Group. Jacksonville, Fla.-based FIS was selected by Sainsbury's as the bank’s technology partner for all its retail banking operations. Under the terms of this strategic multi-year arrangement, FIS will provide real-time core banking and back-office processing support via an outsourced model on behalf of Sainsbury’s Bank.
FIS said it plans to provide a fully integrated real-time core processing and back-office IT solution to Sainsbury's Bank and deliver transition support as the bank moves its back-office services from Lloyds Banking Group to FIS. FIS’ solutions will support the bank’s deposit, savings, loan and credit cards accounts, and deliver channel integration to enable customers to access their accounts through telephone, internet and mobile devices. The operation will be hosted and run by FIS in the U.K.
Sainsbury's said the acquisition price of 248 million Punds is comprised of a cash consideration of 193 million Pounds for the shares and the purchase of 55 million Pounds of loan stock at par value.