Barclays has confirmed that Woolwich will become the mortgage lending arm of the bank if the proposed purchase goes ahead.
Tracey Goodyear, a spokes-person at Barclays, said: “We will maintain and develop Open Plan and the Woolwich brand within the enlarged group. It will become the group mortgage brand with a separate and distinct high street presence.”
Barclays’ offer to purchase Woolwich for £5.35bn is expected to raise its presence in the mortgage market and bring Woolwich’s flexible product, Open Plan, to an additional 13 million customers. The acquisition is likely to mimic Lloyd’s TSB’s take-over of Cheltenham & Gloucester – the Lloyd’s brand no longer exists in the mortgage market and all business is directed through C&G.
Ray Boulger, technical director at John Charcol said: “There is little logic in Barclays maintain-ing a separate brand name for mortgages, as it put its offer to Woolwich on the grounds that the Woolwich had better products and a better brand in the mortgage market.”
Barclays’ offer is said to have put pressure on other small to medium-sized banks to put themselves up for sale, such as Abbey National and Alliance & Leicester, which have both seen their shares plummet this year.
Abbey National refused to comment on the rumour. But Michelle Pegley, press office manager at Alliance & Leicester, confirmed that it was keen to remain independent. “We have just unveiled a new strategy that is designed to promote our independence going forward,” she said.