Banking giant Barclays is to acquire the deposits, mortgages and business assets of ING Direct UK from Dutch finance house ING.
Barclays will acquire a deposit book with balances of £10.9bn and a mortgage book with outstanding balances of £5.6bn, as at 31st August 2012.
The mortgage book had a loan to value ratio of 50% at the end of August and is being acquired at a discount of around 3%. The deposit book is being acquired at face value.
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Barclays said the transaction is expected to boost return on equity immediately while the impact on Core Tier 1 capital - a key measure of balance sheet strength - is not material.
Barclays intends to integrate the ING Direct UK business into its UK Retail and Business Banking division, but in the meantime Barclays will continue to use ING Direct UK's operations and platforms to service existing customers. ING Direct UK customers who transfer to Barclays are expected to continue to enjoy at least equivalent terms and conditions to those which they currently enjoy.
Completion is expected to occur early in the second quarter of 2013.
The sale follows the announcement by ING on August 2nd that it was reviewing the strategic options for the business.
JH
