Santander has reached an agreement to acquire TSB for £2.65 billion, raising concerns about the potential disappearance of TSB branches from the high street. The merger will create a combined bank with close to 28 million customers, positioning it as the third-largest UK bank based on personal current account deposits, trailing only Lloyds and NatWest.
Sabadell, the Spanish parent company of TSB, had indicated its interest in selling the UK business, with Barclays also expressing a bid for TSB. Originally part of Lloyds Banking Group, TSB underwent a demerger in 2013, leading to its acquisition by Sabadell for £1.7 billion in 2015.
Santander plans to integrate TSB into its group following the acquisition, potentially resulting in the phasing out of the TSB brand from the high street and the migration of its customers to Santander. Despite this, specific details regarding the future of the TSB brand remain undisclosed, assuring customers of business as usual for both TSB and Santander in the interim.
During a presentation to analysts, Santander hinted at upcoming branch closures and outlined intentions for a rationalization of the branch network and structure to address property overlaps. However, immediate changes for customers or branches are not expected, pending shareholder approval of the deal, which is anticipated to conclude in the first quarter of 2026. TSB currently operates approximately 175 physical high street branches across the UK, while Santander boasts 349 branches.
Douglas Grant, Group CEO of Manx Financial Group, highlighted that while the acquisition will enhance Santander’s presence in the UK, it may lead to significant branch closures, subject to regulatory scrutiny. TSB’s Chief Executive, Marc Armengol, expressed optimism about the merger, viewing it as a positive development for the bank and its loyal customers.
Santander UK CEO, Mike Regnier, emphasized the strategic benefits of the deal, emphasizing the alignment of the two banks’ strengths and the enhancement of industry competitiveness. The acquisition is set to propel Santander’s transformation journey, focusing on improved customer offerings, innovative products, digital advancements, and enhanced service quality across branch networks nationwide.
Regnier reassured a seamless integration process, leveraging technology and experience to maintain service excellence for customers and support for employees during the transition. The commitment to building a stronger bank for the future underscores Santander’s dedication to customer satisfaction and sustainable growth.