LONDON — Richard Branson's Virgin Money opened its first bank branch on Monday in northeast England after its takeover of state-rescued Northern Rock.
Nationalized at the height of the global financial crisis in 2008, Northern Rock was sold in November to Virgin Money for £747 million ($1.18 billion, 872 million euros) in cash.
"The Virgin Group has always gone into markets where there's been an opportunity to make things better for customers," Branson told reporters at the group's first converted branch in Newcastle, where Northern Rock was based.
"We've been doing it for 40 years, with some real milestone moments along the way, from our first steps in the record industry to launching Virgin Atlantic. Now we want to do the same for banking.
"It's not something we take lightly. There's a lot of hard work ahead. But we have the people, the products and the plans in place," he added.
The takeover deal covered 75 Northern Rock branches, one million customers, 2,100 employees, a £14-billion mortgages book and £16-billion of retail deposits.
All the branches will be rebranded under the Virgin Money banner over the next nine months, while the acquisition gives the former online lender a presence in the mortgage market for the first time.
Northern Rock was plunged into crisis in mid-September 2007 when its exposure to the credit crunch forced it to seek emergency assistance from the Bank of England, sparking the first run on a British bank in recent history.
The lender was last year split in two, forming a so-called "good bank" for its healthy businesses and a "bad bank" management company to wind down toxic assets. Only the "good" bank — Northern Rock Plc — was sold to Virgin.
Founded in 1995, Virgin Money is backed by Wilbur Ross, the billionaire Wall Street investor, as well as an Abu Dhabi investment fund.
The group has pledged to make no compulsory redundancies at Northern Rock for at least three years. — Agence France-Presse
source:gmanetwork.com
