Co-op Bank to buy Lloyds branches
The Co-operative Group has been named preferred bidder for 632 branches being sold by Lloyds Banking Group.
The Co-op was in competition with NBNK for the branches which are being sold under European competition rules.
It will now enter exclusive talks with Lloyds over the deal, which would expand its branch network to 947, giving it a presence on High Streets across the UK.
Lloyds is selling all its Cheltenham & Gloucester branches, all its Lloyds TSB Scotland branches and a number of Lloyds TSB branches in England and Wales.
The deal, which also includes 5.5 million customers and £83 billion in deposits and mortgages, would make the Co-op the seventh-largest British bank and place it in competition with the ‘big five’ – Barclays, HSBC, Lloyds, Santander and RBS.
The terms of the sale still have to be finalised but it is hoped that the branches will be handed over by April 2012.
The Co-operative Bank today announced that it is cutting the rates of its fixed rate mortgage range by up to 0.60 per cent in order to encourage activity in the housing market.
Its two-year fixed rate, 85 per cent LTV mortgage will be cut by 0.20 per cent to 3.79 per cent. The mortgage carries a £999 fee.
Its three-year fixed rate, 90 per cent LTV mortgage, also with a £999 fee, is being reduced by 0.30 per cent to 4.89 per cent.
Finally, the Co-op’s five-year fixed rate, 90 per cent LTV mortgage, is being reduced by 0.60 per cent to 5.39 per cent, and no fee is payable.
James Hillon, the bank’s head of mortgages, said: “In addition to lowering our rates again, we’re also supporting both new and existing homeowners through the varied LTV and fee free options across our product range.”