Sainsbury’s mulls offers for £1.9bn mortgage book
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Big Four grocer Sainsbury’s is reportedly fielding bids for a takeover of its £1.9bn mortgage book, as part of an overhaul of Sainsbury’s Bank.
According to a report by Sky News, the retailer has already received a number of offers, including bids from Lloyds Banking Group. Bankers at BNP Paribas are handling the auction.
Sky News added that Sainsbury’s mortgage book is about half the size of Tesco Bank’s, which exited the home-loans market earlier this year.
Additionally, the retailer said that capital injections into its financial arm in the first half of the year amounted to £35m, and it added that no further capital injections are expected.
Sainsbury’s financial services total income remained broadly flat year-on-year at £227m, as higher interest and commission income was offset by increased interest payable, as reported in its half-year trading update last month.
A Sainsbury’s Bank spokesperson told Retail Sector: “As announced in September, we have stopped issuing new mortgages and are exploring options for the existing book. One option is to sell the book and we are exploring this option with interested parties. We emphasise that this is only one of the possible options.”
