As a CeMAP-qualifed mortgage advisor, news like this is something you will be particularly interested in.
The Santander company has Abbey within its portfolio, so when its bid for Alliance and Leicester was accepted last week, this means that when the takeover is finalised Alliance and Leicester will merge with Abbey. The deal is apparently worth £1.26 billion.
Santander is a Spanish banking group and currently is the second largest bank in Europe – in terms of market capitalisation – second only to HSBC.
This merger will be good news to the FSA (Financial Services Authority) as they have been concerned about the robustness of the high street banking infrastructure since Northern Rock’s demise and the recent Bradford & Bingley bailout, although they will also be wary of the influence this now gives the big banks as Alliance & Leicester disappears as a sole company.
Alliance and Leicester’s Chairman, Roy Brown, said the offer was too good to refuse, considering:
“the significant external risks presented by the deterioration in economic conditions and the continuing turbulence in the financial markets.”
Chris Eagle, Commercial Manager at Credit Choices, believes that the rumoured £1.26 billion all-share deal is a real steal:
“Santander have done their homework and bought a bank that was valued at three times the amount they’re paying for it just two years ago. This could prove to be a psychological fillip for consumer confidence, with customers of both banks buoyed by the galvanising effect of the merger, but the market share as a whole may now be weighted too far in the direction of one or two banking groups.”
After CeMAP training, those who choose to become mortgage advisors will be very interested to see the impact this takeover will have on the mortgage market.