Nationwide’s £3bn takeover of Virgin Money expected to complete by end of year

Nationwide’s £3bn takeover of Virgin Money is expected to complete by the end of the year.

The timeline was of the deal was revealed in a market update posted by Virgin Money.

The deal will be the largest UK bank merger since the financial crisis and it will make the Swindon lender  the second-biggest provider of mortgages and savings accounts in the country.

Just as importantly it will give Nationwide a foothold in the lucrative business banking sector.

David Duffy, chief executive of Virgin Money, confirmed the timeline in a market update.

He said: “Our strategy remains on track, with financial performance in line with guidance. We delivered continued growth in deposits and unsecured lending in the third quarter and remain focused on developing innovative new products for customers and maintaining good momentum into the fourth quarter.

“The acquisition by Nationwide is progressing as anticipated with the recent CMA clearance, and we expect it to complete in the final quarter of the calendar year.”

Subject to the proposed acquisition completing, Virgin Money will recognise further transaction-related adjustments, but anticipates remaining well-capitalised as part of the larger Nationwide group.

The CMA has unconditionally cleared the proposed acquisition following it investigation but  the proposed acquisition remains subject to other regulatory approvals.

Virgin Money added that it has deferred certain restructuring activity as part of its ongoing cost savings programme, in light of the proposed acquisition.

As previously announced, the board does not intend to announce any further share buybacks or dividends given the proposed acquisition.

The proposed acquisition remains subject to certain outstanding conditions, including the receipt of PRA and FCA approval and sanction by the Court

Virgin Money expect to recognise further transaction-related adjustments, including TMLA exit fee and day-1 accounting harmonisation changes.

The bank said it  expects to remain well capitalised as part of Nationwide Group