Sainsbury Agrees to Sell Core Banking Business to NatWest

Sainsbury's (LON: SBRY) announced Thursday that it has entered into an agreement to sell its core banking business to NatWest Group. The deal includes Sainsbury's Bank's personal loan, credit card, and retail deposit portfolios.

The transition for customers is expected to take place in the first half of 2025, with the deal set to be complete within the same period.

“Today's news means we will focus all our time and resources going forward on growing our core retail business,” said Simon Roberts, Sainsbury's CEO. “NatWest's values and customer focus are a close fit with ours and as one of the UK's leading banks, NatWest's scale and financial services expertise will ensure our existing financial services customers continue to be well looked after.”

The sale does not include Sainsbury's Bank's commission income businesses, such as insurance, ATMs, and travel money. Additionally, Argos Financial Services is not part of the deal. Sainsbury's will provide a further update on their plans for Argos Financial Services at a later date.

Sainsbury's Bank customers are expected to transfer to NatWest automatically and will be contacted with more information in due course.

There will be no immediate changes to their existing terms and conditions.

“We look forward to welcoming new customers to NatWest Group,” said Paul Thwaite, NatWest Group CEO. “This transaction is a great opportunity to accelerate the growth of our Retail banking business at attractive returns, in line with our strategic priorities.”

The acquisition is expected to benefit both companies. Sainsbury's will gain access to additional capital to invest in its core retail business, while NatWest will expand its customer base and strengthen its credit card and unsecured personal loan offerings.