TSB: Spanish parent firm Banco Sabadell considers sale of UK high street bank
The Spanish parent firm of TSB has said it is considering the sale of the UK high street bank.
Banco Sabadell, which is currently seeking to defend itself from being taken over by a major rival, said it will weigh up any potential offers for TSB.
In a regulatory filing, the banking giant said it received “preliminary non-binding expressions of interest for the acquisition of the entire share capital of TSB.”
TSB currently runs around 175 branches across the UK.
It comes a decade after Sabadell bought TSB for £1.7bn to gain a foothold in the UK, a year after Lloyds had spun off TSB in a stock market float.
Last month, TSB saw first-quarter profits nearly double thanks to cost-cutting and improved mortgage lending ahead of April’s stamp duty deadline.
The lender posted pre-tax profits of £101.3m for the first quarter, up from £53.4m a year ago.
The Financial Times reported that potential bidders for TSB could include Barclays, NatWest, Santander UK and HSBC.
The potential disposal comes as Sabadell seeks to rebuff a potential hostile takeover by Spanish rival BBVA.
BBVA has launched an 11 billion euro (£9.4bn) move to take control of Sabadell and plans to put this offer in front of shareholders in the coming months.
The potential sale of TSB is the latest in a flurry of recent dealmaking moves in the UK banking sector. Metro Bank shares jumped after reports it had attracted a takeover approach from investment firm Pollen Street Capital.
Meanwhile, Santander has reportedly pushed back bids from NatWest and Barclays to buy its UK retail bank.
In May, TSB reported a leap in mortgage business as secured lending jumped 12 per cent year on year to £1.5bn in the three months to the end of March.
The group said that in March alone, it helped borrowers buy more than 3,000 new homes – a 36 per cent rise year on year for that month.
Lenders reported booming mortgage business at the start of the year as borrowers sought to complete on house purchases ahead of the stamp duty change from the beginning of April.
Lloyds Banking Group last month said its mortgage lending grew by £4.8bn as it saw 19,000 completions in the first three months of the year, with March 27 its biggest-ever single day for completions.
TSB said it also saw strong demand for credit card lending and personal loans, up 5 per cent and 13 per cent respectively – its strongest quarter for loans since 2020.
“The UK consumer remains resilient in the face of sluggish economic growth and uncertainty about the global outlook,” it said in a statement issued last month.