Sainsbury(J) PLC Sainsbury's Bank sells mortgage portfolio (1238J)

TIDMSBRY

RNS Number : 1238J

Sainsbury(J) PLC

11 August 2023

Sainsbury's Bank confirms sale of mortgage portfolio to The Co-operative Bank

J Sainsbury plc ("Sainsbury's") today confirms that Sainsbury's Bank plc ("Sainsbury's Bank") has agreed to sell its mortgage portfolio to The Co-operative Bank p.l.c. ("The Co-operative Bank") for a cash consideration of around GBP464 million*, payable at completion. The gross asset value of the mortgage book at 30 April 2023 was GBP479 million (GBP467 million net asset value after hedging). The sale follows the September 2019 announcement by Sainsbury's Bank that it would be stopping all new mortgage sales and was reviewing options for the existing mortgage book.

The deal is expected to complete alongside transfer of beneficial ownership on 15 August 2023, with legal title transfer occurring within 12 months. Following a period of transition of up to one year from completion, Sainsbury's Bank mortgage customers will transfer to The Co-operative Bank.

Sainsbury's Bank intends to use the proceeds from the transaction to help optimise the overall cost of funding for Sainsbury's Bank.

In the year ended 28 February 2023 the associated direct profit contribution of the mortgage portfolio was GBP4 million**.

Commenting on the sale, Jim Brown, CEO of Sainsbury's Bank said: "We're pleased to confirm we have agreed the sale of our mortgage book to The Co-operative Bank. Closing the chapter on our mortgage offering is a big step in simplifying our business.

"It's been really important throughout the process that we find a buyer that will best meet the needs of our customers. W e chose The Co-operative Bank as it's a well-known UK mortgage provider, committed to providing excellent customer service, so we are confident that The Co-operative Bank will serve our customers well.

"The sale of the mortgage book will support our strategy to reshape our portfolio and focus on offering capital and cost efficient, mobile-led financial services to loyal Sainsbury's and Argos customers."

Nick Slape, CEO of The Co-operative Bank said: "We are delighted to have agreed this transaction with Sainsbury's Bank. Once the transfer activity is complete, we look forward to welcoming the new customers who will benefit from our ambitious new technology platform, which will simplify our banking services and will make us more efficient, giving us the flexibility to introduce new products and services.

"This transaction, our first portfolio acquisition in more than a decade, further demonstrates the progress we have made in recent years and our strength in what remains a competitive UK mortgage market."

Deloitte advised Sainsbury's Bank on the sale.

Enquiries

Investor Relations: James Collins +44 (0) 20 7695 0080

Media: Rebecca Reilly +44 (0) 20 7695 7295

* the exact size of the portfolio and consideration payable will depend on movements in the portfolio up to completion

** profit contribution stated after removing a one off COVID related release of expected credit loss provision of GBP2 million, before the allocation of any central overheads and before tax .

This information is provided by RNS, the news service of the London Stock Exchange. RNS is approved by the Financial Conduct Authority to act as a Primary Information Provider in the United Kingdom. Terms and conditions relating to the use and distribution of this information may apply. For further information, please contact rns@lseg.com or visit www.rns.com.

RNS may use your IP address to confirm compliance with the terms and conditions, to analyse how you engage with the information contained in this communication, and to share such analysis on an anonymised basis with others as part of our commercial services. For further information about how RNS and the London Stock Exchange use the personal data you provide us, please see our Privacy Policy.

END

DISGPUWCRUPWGWG

(END) Dow Jones Newswires

August 11, 2023 09:45 ET (13:45 GMT)

Sainsbury (j) (LSE:SBRY)
Graphique Historique de l'Action
De Mar 2024 à Avr 2024