Nationwide Building Society’s £2.9 billion takeover of Virgin Money has secured full regulatory approval from the Financial Conduct Authority and the Prudential Regulation Authority, ensuring the transaction is set to complete this autumn.
Shareholders of both financial institutions have been informed that the merger, first announced in March, has cleared its final regulatory hurdle. The merger will create the United Kingdom’s second-largest provider of loans and mortgages. It is hoped the deal will finalise by October 1, coinciding with the cancellation of Virgin Money’s shares on both the London and Australian stock exchanges.
The Competition and Markets Authority had previously given its consent in July, indicating that the acquisition would not significantly diminish competition across various financial products, including owner-occupied mortgages, buy-to-let mortgages, and credit cards.
Following the regulatory approvals, Nationwide Building Society has announced several key appointments. Muir Mathieson, the current deputy chief financial officer, has been promoted to chief financial officer and executive director, replacing Chris Rhodes. Rhodes is anticipated to assume the role of chief executive officer of Virgin Money, succeeding the current CEO, David Duffy, who is set to retire upon the deal’s completion.
Although comprehensive plans for Virgin Money’s integration are still under development, Nationwide has committed to addressing existing IT and customer service issues at Virgin Money. It has also been agreed that the Virgin Money brand will be retained initially, but phased out over a six-year period. Nationwide has pledged to maintain Virgin Money branches in all existing locations until at least the beginning of 2026, except where pre-existing closure plans are in place.
The merged entity will comprise approximately 25,000 staff and 700 branches, serving 24.5 million customers. Nationwide has assured that there will be no immediate substantial changes to Virgin Money’s workforce, and that existing staff rights, including pensions and redundancy policies, will be preserved.
During the recent Annual General Meeting, Nationwide’s Chief Executive, Debbie Crosbie, emphasised that significant consideration had been given to both the risks and opportunities presented by the acquisition. She underscored the profitability potential of Virgin Money’s range of credit cards as a key factor in the decision to proceed with the takeover. Nevertheless, the deal still requires court sanctioning, with a hearing scheduled for September 27.
With full regulatory approval secured and strategic leadership changes underway, Nationwide’s acquisition of Virgin Money is poised to reshape the landscape of financial services in the United Kingdom, assuming court sanctioning proceeds as scheduled.
