Barclays UK Completes Previously Announced Acquisition of Tesco Bank

Barclays UK has completed its previously announced acquisition of the retail banking business of Tesco Personal Finance (Tesco Bank).

Together with the completion of the acquisition, Barclays UK has entered into a 10-year exclusive strategic partnership with Tesco Stores Limited to market and distribute credit cards, unsecured personal loans and deposits using the Tesco brand and to explore other opportunities to offer financial services to Tesco customers, Barclays said in a press release.

The business acquired by Barclays UK includes credit cards, unsecured personal loans, deposits and the operating infrastructure, according to the release.

It will continue to operate under the Tesco Bank brand while operating under the ownership and management of Barclays UK, per the release.

“This acquisition is an important step in increasing our investment in the U.K.,” Barclays CEO C.S. Venkatakrishnan said in the release. “We look forward to collaborating with Tesco Group on delivering Tesco-branded financial services.”

Ken Murphy, group CEO of Tesco, said in the release that the strategic partnership will enable Tesco Bank customers to access new offerings while continuing to receive the benefits of Tesco Clubcard.

“This is a significant moment for all our colleagues at Tesco Bank and I want to say a heartfelt thank you for all their hard work, helping millions of loyal customers to manage their money for more than 25 years,” Murphy said. “Their dedication is relentless and I know that this new partnership with Barclays will only build on their success.”

The companies announced in February that Barclays had entered into an agreement to acquire Tesco Bank and that about 2,800 employees of Tesco Bank would join Barclays UK.

It was reported in November 2023 that Tesco had invited potential buyers to submit non-binding offers for Tesco Bank as part of its efforts to downsize its financial services footprint.

Tesco Bank was launched in 1997 as a joint venture between Tesco and the Royal Bank of Scotland. Tesco later acquired full control of the company.

Over the years, Tesco scaled back its banking services, discontinuing current accounts and selling its mortgage portfolio to Lloyds Banking Group.

Tesco Bank remained an attractive prospect for potential buyers due to the opportunity to cross-sell banking products to Tesco’s vast customer base.