Concern on dual price as Santander realigns

Abbey, Bradford & Bingley and Alliance & Leicester will be renamed under the global brand of parent Santander by the end of 2010.

However, the firm's intermediary arms - Abbey for Intermediaries (AFI) and Alliance & Leicester Intermediary Sales - will keep their names, leading to speculation that the group could pursue a more aggressive policy of differential pricing under the separate brands in the future.

The rebranding of the retail side of the business kicks off next month, with Abbey credit cards adopting the group name, and every facet of the business, bar the intermediary arms, will operate under the Santander banner by the end of 2010.

António Horta-Osório, chief executive of Santander's UK businesses, said the switch provided a single customer view that was unique in UK banking.

"It will allow Santander to offer the full range of its products across its enlarged UK network. More importantly, it will allow the UK business to leverage the expertise and product developments from Santander's global business."

The fact that the intermediary operations will be excluded from the rebrand has caused concern that this side of the business will not enjoy these benefits.

Ray Boulger, senior technical manager at John Charcol, said: "It is hard to come to any conclusion apart from this leaving the door open for Abbey to dual-price to an even greater extent than they do already.

"One can see the logic in the rebranding - clearly this was always going to happen at a bank with ambitions to be a global brand. But why would they not take it to its logical conclusion and rebrand the intermediary businesses if not to differentiate on product? This suggests that they are not planning to offer Santander products through AFI and Alliance & Leicester for Intermediaries."

Ricky Okey, managing director of intermediary distribution for Abbey and Alliance & Leicester, countered that brokers themselves had indicated that they would prefer the existing intermediary brands to remain in place, and refuted any accusation of intent for the lender to change its strategy.

He said: "Regardless of how we brand our retail and intermediary divisions, brokers will see little change in our tactical approach to our business, We will continue to lend in what is a difficult market and we will offer competitive products with broker exclusives."