The takeover, announced last Friday, led to Ambrose McGinn, director of Abbey for Intermediaries, issuing a statement of reassurance to key relationship customers, particularly those dealing with insurance products, that Banco Santander was committed to the company’s distribution structure.
The statement, quoting the press release announcing the takeover, said: “On the insurance side, Banco Santander believes it can significantly increase the penetration of general insurance and protection products by more effectively selling to Abbey’s mortgage customer base. In addition, Banco Santander plans to improve the sale of insurance-based investments and pensions.”
Rob Clifford, managing director of Mortgageforce, one of a number of senior industry figures who last year wrote an open letter to Abbey complaining about poor service to intermediaries, commented: “I think that the takeover can only be a good thing for intermediaries. With Abbey having been up for sale for a while, senior management will have focused their attention on selling the business rather then dealing with the day-to-day running of the company.”
Clifford added that while another bid was unlikely, due to the amount of work already put into the current deal, it could not be ruled out.
Ray Boulger, senior technical manager at Charcol, agreed that Abbey had been in the frame for a takeover for some time. He said that since Banco Santander was foreign it was likely to increase competitiveness in the UK mortgage market by providing cheaper funding. “I think this is good news rather than bad news for intermediaries. If a UK-based company acquired Abbey it could reduce completion on mortgage products,” he said.
“Because of Abbey’s distribution channels and brand name, it is seen as an attractive buy for a foreign bank which is keen to break into the lucrative UK mortgage market,” he added.
