Tuesday, 27 November 2012

Millions of Lloyds customers on the move

Millions of customers of Lloyds TSB will start receiving letters from the bank from tomorrow morning, telling them that their accounts will be moved to a new bank owned by the Co-op. It's the result of an order from the European Commission requiring Lloyds to hive off hundreds of branches.

Three and a half million Lloyds TSB customers will receive the letter between now and Christmas. Although the deal was announced in the summer, it's the first time they will have been told officially by their bank that their accounts are to moved.

They'll stick with the same branches in a new banking operation to be called TSB, but owned by the Co-operative Bank which will become a more more significant player in financial services. Their account numbers and interest rates will stay the same.

In the letter the customers will be told that they can register their wish to stay with Lloyds, either by phone or in the branch. However, they won't need to make a final choice until next year.

The hiving off of 632 Lloyds TSB and Cheltenham & Gloucester branches, along with a total of 4.6m customers, was required by the European Commission after Lloyds benefited from a bailout from the taxpayer during the financial crisis and emerged from the turmoil with a huge share of the market.

How Lloyds describes the timetable:

Step 1
Branches, accounts and customers that will be part of the new bank are selected.

Step 2
We are here.
Legal move to Lloyds TSB Scotland plc – the branches and accounts that are included will be brought
together under one banking licence.

Step 3
If you have debit and credit cards, another step in the preparation is to send you new ones – they will
still be Lloyds TSB cards and work in the same way.

Step 4
When everything’s together under one licence, the business will be renamed as TSB Bank plc.

Final step
By the end of 2013 TSB Bank plc will transfer to a new owner.

For more info and list of branches affected, look here.

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