According to The Sunday Telegraph, the PRA is hiring advisers to examine the deal and whether the integration of W&G’s computer systems could cripple CYBG.
Last month CYBG announced it was in discussions with Royal Bank of Scotland (RBS) to take on its W&G unit and made a preliminary non-binding proposal.
RBS has struggled to divest its W&G’s arm since the financial crash in 2008 when it was tasked with the job of separating out W&G by the end of 2017 as part of its £45bn bailout.
The bank failed to agree the terms of the sale of W&G in H1, citing the archaic IT system currently in place as the cause.
This is not the first time the IT system has proved an obstacle for offloading W&G as Santander bank emerged as a bidder in 2012, only to walk away because of issues with its IT system. In August, the bank put in another bid but it collapsed because of a disagreement over the price.
If CYBG successfully acquires W&G, the new bank will have 314 branches with an expected 1.8m customers, catapulting the lender into becoming one of the country’s biggest challenger banks.
