Nationwide is planning to buy Virgin Money as it accelerates its strategy to become a modern mutual.
The offer for £2.9 billion would combine Nationwide’s over 16 million members with Virgin Money’s 6.6 million customers.
According to Nationwide, the deal would put it in a stronger position to provide payments to members, better value mortgages and savings and leading customer services. Members would also in the future get access to Virgin Money’s product suite, including its business banking services.
“A combined group would deliver the benefits of fairer banking and mutual ownership to more people in the UK,” explained Chairman Kevin Parry in a letter to members. “Nationwide remains wholly committed to being a modern mutual that can meet all its members’ banking needs.”
He added: “If the acquisition proceeds, it will accelerate our strategy and create a stronger and more diverse business that is better placed to deliver financial value to our members, both now and in the future.”
Conall O Móráin, Host of the That Great Business Show podcast, commented on X.com that phasing out the Virgin Money brand could save huge amounts of money, with the licensing of the brand from Virgin Group having cost £17 million last year.
The news came several months after Nationwide undertook its first major rebrand since 1987, centred around the benefits it can offer as a modern mutual. The building society created a new logo which simplifies the old one, as well as stylising its name in all lower case while removing the words “building society”.
A light-hearted new ad was launched starring The Crown star Dominic West as an out-of-touch banking boss with comedian Sunil Patel as his sceptical assistant to spotlight how Nationwide differs from its banking rivals.
The mutual also emphasised it would be continuing to invest in its branches. Much of Nationwide’s recent marketing has focused on explaining the benefits of building society to a new generation, especially as the cost of living crisis has given it a clear way of differentiating itself.
According to the mutual, the rebrand aims to ensure it “remains attractive and relevant for future generations of customers looking for a financial services provider that puts people before profit.”
