In an update today, the regulator said that the acquisition will “require any immediate changes to the capital structure of the Virgin Money Group or the combined group as a whole”.
There will be a court hearing on 27 September that finally sanctions the takeover, and the deal is expected to be agreed on 1 October 2024. Then, Virgin Money will be removed as a listing on the London Stock Exchange.
Following the green light from the FCA and PRA, Virgin Money released a statement to tell customers they do not need to take any action amid the developments of the deal.
The lender wrote: “For now, there’s no impact to your Virgin Money products or services (including Clydesdale and Yorkshire Bank products and services), and no changes to FSCS deposit protections. If anything changes in the future, we’ll let you know in advance.
“We’ll continue to keep our website up to date with the latest news and our teams are as committed as ever to delivering great service to you”, it added.
It also warned account holders to be vigilant of fraudsters who “often take advantage at times of change” and told customers not to share security details if someone calls and asks for them, purporting to be from the bank.
Nationwide confirmed in March it had struck a potential takeover of Virgin Money for around £2.9bn, in a move that would make it the second-largest provider of mortgages and savings in the UK.
The Competition and Markets Authority (CMA) then cleared the deal in July, after it declared the move would not lessen the competition available in the market.
A future date customers might wish to make a note of is 31 January 2025, which is when the acquisition by Nationwide of Virgin Money is set to be finalised.
As part of the announcement, the PRA added that it intends to apply select prudential requirements to Virgin Money until 2028, which means that the “outstanding externally held own funds issued by Virgin Money will, subject to applicable deductions, be eligible to meet the consolidated capital requirements applicable to the combined group”.
The Bank of England said it will also exercise discretion to treat “outstanding externally held eligible liabilities” issued by Virgin Money as eligible to meet “consolidated Minimum Requirement for Own Funds and Eligible Liabilities (MREL)” until 2028.
Nationwide and Virgin Money added that they “intend to simplify and align their capital structures over time as part of broader integration planning”.
This article is based on one that was first published on YourMoney.com‘s sister site, Mortgage Solutions. Read: FCA and PRA give green light to Nationwide-Virgin Money merger
