What is happening?
Around 1.8million Royal Bank of Scotland (RBS) and NatWest customers will receive letters this week, telling them that their accounts are going to be sold to Santander.
The Spanish banking giant already has a huge presence in the UK. It acquired Abbey in 2004 and, in September 2008, it bought Bradford & Bingley’s savings and branch network. A month later, Santander also acquired Alliance & Leicester (A&L).
But RBS hasn’t been bought out, so why is my account being moved?
During the financial crisis, RBS Group was bailed out by the state to the tune of around £54billion. That meant European regulators stepped in and demanded the group restructure, by selling off certain of its branches.
RBS branches in England and Wales, plus NatWest branches in Scotland are being sold to Santander, meaning all accounts registered to these branches will be passed over too.
None of the Scottish RBS branches or the English and Welsh NatWest branches will be affected.
When will this happen?
There’s plenty of time before this happens: RBS says that the sale is likely to take at least a year but probably 18 months, during which time customers’ will continue to receive the same service as before.
RBS Group says it does not expect that anyone’s account details will need to change once the branches are sold, but it will let customers know as soon as possible if that changes.
Do I need to do anything?
At the moment, simply continue as normal – your account won’t be changing for at least 12 months. If you decide you’d rather not move to Santander then you can, of course, switch your current account.
Will my money still be protected by the Financial Services Compensation Scheme?
Although Santander is a Spanish company, your money is as safe as in any other banking group. It’s a huge global bank and your money is guaranteed under the FSCS scheme, meaning the first £50,000 saved with the bank is protected.
Having said that, if you have £50k with RBS and £50k with Santander, once your account is moved over, only half your money will be guaranteed by the government, so it’s time to look for another account. Keep track of which bank owns which brands, with our article ‘Who owns who?’.
Can I still open an RBS or NatWest account?
You can still open a new personal bank account at any of these branches; it will remain business as usual for at least the next 12 months.
However, bear in mind that if you do open an account at an affected branch, it will be passed to Santander once the sale has concluded.
Will there be branch closures?
It’s hard to say but Santander has said it remains ‘committed’ to the branches it is buying and will keep customers informed if anything changes.
What about my credit card, loan or mortgage?
Credit cards and ISAs are not being included in the sale, but loans and most mortgages will be transferred to Santander.
Do I have to change banks?
No one can force you to change banks but RBS is not allowed to solicit customers to stay. However, that doesn’t mean you can’t if you want to. Call the RBS helpline on 0800 210 0214 to discuss your options.
Having said that, Santander's Preferred In-credit Rate Account pays a £100 switching incentive, so if you moved ahead of the sale, you could benefit from some extra cash.
Will Santander change RBS and NatWest customers’ accounts?
Santander says that it is really too early to say what will happen to the accounts. They might be aligned with the bank’s other products, in a similar way to how A&L's accounts have been absorbed, or Santander might maintain the same terms and conditions as the RBS and NatWest products for the affected customers.
A spokesman assured people that whatever happens, both banking groups will let customers know as soon as any decisions are made.
What brand will my account be after the sale?
The branches will become Santander banks in due course but the intricacies of the deal haven’t yet been hammered out, so it's too early to say at this stage what name the accounts will go under.