Sainsbury’s Share Price Edged 0.74% Higher on a Strategic Update

The J Sainsbury plc (LON: SBRY) share price edged 0.74% higher after announcing plans to divest its financial services division following a strategic review of the division. As the company approaches its strategy update on February 7th, it has undertaken a comprehensive strategic review of its Financial Services division. 

The review aligns with its commitment to enhancing the financial services it provides to its customers while maintaining a sharp focus on its core retail operations. In this vein, the firm is considering various options to refine its approach.

Going forward, the financial service products offered by Sainsbury's will be facilitated through a distributed model involving partnerships with specialised financial service providers. The company has successfully implemented this strategy with its insurance products and intends to extend it further.

The new direction will gradually lead to a phased withdrawal from its primary Banking business. However, it is essential to note that the products or services currently offered to its customers will remain the same due to the strategic shift.

In conjunction with these changes, the company announced a significant leadership transition within Sainsbury's Bank. Jim Brown, the current CEO, will be retiring from his position. Stepping into this role will be Robert Mulhall, a seasoned leader in retail banking known for his expertise in driving successful transformations. 

Robert's extensive experience includes his role as CEO of Allied Irish Bank's UK division until 2022 and his prior leadership of AIB's Irish retail banking division. More recently, he has been at the helm of VISION Consulting's global financial services consulting business, focusing on business transformation.

Following a transition period, Robert Mulhall is set to assume his new role as CEO of Sainsbury's Bank at the end of March.

Simon Roberts, Chief Executive Officer, J Sainsbury plc: “We have been clear since we launched our Food First strategy in 2020 that we would concentrate our efforts on our core retail businesses, and today's announcement reflects that strategic focus. It's business as usual for now at Sainsbury's Bank, and there will be no immediate changes to products and services as a result of today's announcement. We will, of course, communicate directly to customers well in advance of any changes to their products and services.”

Sainsbury share price. 

The Sainsbury share price edged 0.74% higher to trade at 287.40p from Wednesday’s closing price of 285.30p.