Barclays buying Standard Life Bank

26th Oct 2009 13:06

Barclays has agreed to pay £226m in cash for Standard Life Bank and will look at joint opportunities with Standard Life in the UK retail long-term savings and investments sector.The UK bank will get a savings book of about £5.5bn from insurer Standard Life and a mortgage book with outstanding balances of around £8.8bn, with an average indexed loan to value ratio of 48%.Standard Life Bank reported IFRS underlying pre-tax profit of £26m for 2008, £15m for the half-year ended 30 June 2009, and has "traded well" since then. The deal is expected to complete in the first quarter of 2010. "The acquisition of Standard Life Bank is a good fit with Barclays existing UK retail banking business," said Frits Seegers, Chief Executive of Barclays Global Retail and Commercial Banking."This transaction brings to Barclays high-quality savings and mortgage books, and an attractive customer base."Standard Life chief Sir Sandy Crombie said: "We no longer believe that increasing the lending activity of the bank is consistent with our long-term financial objectives."Separately, Barclays UK Retail Banking and Standard Life have agreed heads of terms to enter into a strategic agreement to explore joint opportunities in the UK retail long-term savings and investments sector. The initial focus is expected to be on the development of a multi-channel, simplified pension product.