In an update today, the regulator said that the acquisition will “require any immediate changes to the capital structure of the Virgin Money Group or the combined group as a whole”.

The PRA added that it intends to apply select prudential requirements to Virgin Money until 2028, which means that the “outstanding externally held own funds issued by Virgin Money will, subject to applicable deductions, be eligible to meet the consolidated capital requirements applicable to the combined group”.

The Bank of England said it will also exercise discretion to treat “outstanding externally held eligible liabilities” issued by Virgin Money as eligible to meet “consolidated MREL requirements” until 2028.

Nationwide and Virgin Money added that they “intend to simplify and align their capital structures over time as part of broader integration planning”.

Nationwide has appointed Muir Mathieson as CFO and executive director of Nationwide, effective immediately, and Chris Rhodes will step down from the Nationwide board effective immediately and will prepare to become chief executive of Virgin Money.

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The acquisition is expected to come into force by 31 January 2025, according to the announcement.

Nationwide confirmed in March that it had struck a potential takeover of Virgin Money for around £2.9bn.

Brokers at the time said that the merger would “create another Goliath”, but the merger was cleared by the Competition and Markets Authority (CMA) in July.