Egg deal sees portfolio rolled into Yorkshire Building Society
YORKSHIRE Building Society has acquired the £430m mortgage book and £2.5bn savings business of Egg Banking, it was announced today.
Bradford-based Yorkshire, the UK’s second largest building society, will also acquire the Egg brand.
Iain Cornish, chief executive of Yorkshire Building Society, said: “We are looking forward to welcoming Egg’s mortgage and savings customers to the Yorkshire.
“Continuing to provide them with the outstanding service, administration and value that they have been used to, and which is consistent with our own approach, will be a priority for us and we will work closely with Egg to ensure that customers are kept fully informed throughout this transfer process.”
No amount on the deal for Egg Banking, which is a subsidiary of Citigroup Inc, has been given.
The agreement follows a busy period for Yorkshire in the deals market. It agreed a merger with Norwich and Peterborough Building Society earlier this year and has also acquired the Chelsea and Barnsley brands over the last couple of years.
Mr Cornish has also recently thrown his weight behind calls for the re-mutualisation of Northern Rock, which was nationalised in 2008.
Yorkshire said the acquisition of the Egg savings and mortgage books was in line with its strategy to take advantage of opportunities which it considers to be in the long-term interests of its current and future members.
Yorkshire said benefits to Egg customers of the acquisition would include becoming members of the building society, and the “security and stability provided by the Yorkshire, one of the UK’s strongest financial institutions”.
It said its members would benefit from the Yorkshire being able to deliver greater value through a wider product and service offering, and the combination of Yorkshire and Egg’s product capabilities in the savings market would lead to further innovation.
Egg’s savings book is predominantly based on internet savings and will enhance Yorkshire’s existing funding position, while Egg’s mortgage book comprises low loan-to-value, prime residential loans.
The acquisition is to be implemented by a banking business transfer under Part VII of the Financial Services and Markets Act 2000. The process is subject to approval by the High Court and the acquisition is expected to complete in the fourth quarter of this year.
A team from the Leeds office of law firm Addleshaw Goddard advised Yorkshire on the deal.
