Local branches change hands

Local branches of Lloyds TSB are among the 632 branches to be sold to the Co-operative Group in a deal worth up to £750 million.

The part-nationalised bank, which is offloading the branches to meet European Union rules on state aid following its UK Government bailout, hopes to complete the sale by the end of November next year.

This means the accounts of 4.8 million customers including 3.1 million personal current account customers will transfer to the Co-op.

In the North-east this will affect the Stonehaven branch, nine Lloyds TSB branches in Aberdeen, and those in Alford, Banchory, Banff, Brechin, Buckie, Culter, Ellon, Fraserburgh, Insch, Inverurie, Keith, Montrose, Peterhead and Turriff.

Stonehaven councillor Peter Bellarby commented: “This will be unsettling for local customers at first as many people stay with the same bank for years. However the extra competition can only be beneficial in the long-run.

“Although some Stonehaven residents may be concerned at the number of businesses operated by the Co-operative Group in Stonehaven, in the banking sector there will be healthy competition with four different banks having offices in the town.”

North Kincardine councillor Ian Mollison added: “A strong banking sector relies on diverse banks competing for customers. This deal will help throw open the retail banking market, and will help the industry move back to responsible banking.

“Furthermore the mutual approach to business gives people a proper stake in the places they work, spreading wealth through society.”

A Lloyds spokeswoman said the affected branches will be rebranded to TSB from spring 2013 and will transfer to the Co-operative at completion under that brand.

The TSB business would operate separately for a period ahead of integration with the existing Co-operative Banking Group.

Co-operative Group chief executive Peter Marks said: “It will be a great deal for customers because it will make the services of our member-owned, customer-led, ethically-driven, bank available to millions of people we’ve not been able to serve up until now.”

Following the acquisition, the Co-op will have around 7% of the personal current account market. With almost 1,000 branches the combined entity will have around 10% of all UK bank branches and will be similar in size to Nationwide.