Virgin Money confirms plan to enter high street

Last month, Virgin Money signaled its intent by buying regional bank Church House Trust and hiring former Lloyds TSB chairman Sir Brian Pitman as its new chairman.

In an interview last week, Pitman said the acquisition of the branches would allow them to build up a solid retail bank network and compete with other lenders.

He added: “We shall certainly get into the mortgage business and we shall get into fixed deposits. We need to have some service centres to meet customers, and so this is what we plan to do. We will be able to negotiate quite hard, because the banks have to divest the assets. We will only buy if the locations and price of the branches are good.”

Mark Graves, managing director of Linear Financial Services, said that acquiring existing branches was the most efficient way of entering the retail banking and mortgage market.

He added: “Virgin obviously wants to get its business up and running quick. The best way to do that is by buying fully functioning branches. It is important to remember that these assets are decent businesses which lenders were forced to sell.”