Goodbye Abbey and Bradford & Bingley; Hello Santander

Customers of Abbey and Bradford & Bingley (B&B) will notice something different when they next visit their branch or log on to their online banking service: the brands are no more.

Hello from SantanderAs of Monday, their products are provided by Santander, the Spanish bank that has owned Abbey since 2004 and which bought B&B’s savings book last year. As part of the rebranding process, 300 branches in the south east now carry the Santander brand and logos. This will be extended to the remaining 700 branches by the end of the month. It will then be rolled out to the Alliance & Leicester (A&L) brand in the summer. By autumn there will be 1,300 Santander branches across the country.

So what does all this mean for existing customers?

As far as customers are concerned it’s business as usual. For the time being the only thing that has changed is the name of your bank. With the exception of current account customers, the terms and conditions of your existing accounts will remain exactly the same for the time being. However, there will be changes further down the line as Santander aligns the accounts it has inherited from Abbey, B&B and A&L, although all customers will be notified in advance.

Current account customers will see an adjustment to one feature of their account: there will be no overseas transaction charges applied to cash withdrawals they make in Spain from a Santander ATM. Previously such a withdrawal would have attracted a 1.75% transaction fee plus a 2.75% foreign loading fee. However, fees will continue to be levied on withdrawals made in any other country or from non-Santander cash machines in Spain.

Santander ZERO Account

To coincide with the rebranding, Santander has also launched a new current account, the Santander ZERO Account. Customers earn 6.0% interest on balances up to £2,500, a rate that is fixed for 12 months. There are also no oversees usage of unauthorised borrowing fees, although you will be charged an annual interest rate of 12.9% if you go overdrawn. For more information on this account, read our article ‘Get more from your current account’.

However, while highly competitive, the ZERO account is only available to Santander mortgage customers. We are seeing an increasing number of banking products being reserved only for existing customers and this is indicative of Santander’s strategy going forward.

At the opening of the first new Santander branch on Tottenham Court Road in London, the bank’s chief executive António Horta-Osório said: “The more business customers do with us, the more we’ll give them in return.”


And what about potential new customers?

Of course, not all of Santander’s products are restricted to existing customers only. However, now the Abbey and B&B brands have vanished, products will be marketed under the Santander or A&L name.

So, what for the market going forward?

The takeover by Santander of three British banks is not the only consolidation we’ve seen. There have been numerous mergers and acquisitions in the bank and building society sectors. This has raised concerns among some analysts that fewer players will mean less competition in the market. In turn, this could result in less competitive deals for the consumer.

However, Santander said it will continue to offer competitive deals. Horto-Osório added: “We have more best buy products than any other high street bank and are confident that this strategy will continue to set us apart from our competitors.”

Chairman Emilio Botín said: “We want to be the number one bank in this country.”

And despite the consolidation, new entrants are also likely to help maintain competition. Tesco, Virgin and Metro Bank, a new bank about to launch, will keep up the pressure on the more established players and ensure consumers still have a wide choice when it comes to finding a new banking product.

Kevin Mountford,’s head of banking, said: “Santander will be keen to maintain and grow its position as a major player in UK retail banking and it's challenging its rivals by offering competitive rates and unique deals to customers.

"The disadvantage of bringing these brands under one roof is it reduces competition. We know other players are looking to make in-roads into the retail banking sector so this should help but customers also need to make sure they are on the best deals and be prepare to switch to better products if they are not.”

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