It is no secret that Virgin has been looking to move into the mortgage sector for some time. It is to pay £12.3 million for the bank and invest £37.3 million into the business.
Virgin Money's application to become the controlling shareholder of a bank, namely Church House Trust, has already been approved by the Financial Services Authority (FSA).
Research conducted by Virgin Money over the past two years has shown consistently that there is a clear consumer demand for Virgin Money to enter the banking market. Virgin Money currently has over 2.5 million customers and offers payment cards (credit cards and prepaid cards), savings and investments products (stakeholder pensions, children's pensions, employers pensions, FTSE tracker ISA, bond and gilt ISA, climate change ISA, cash ISA and unit trusts), general insurance products (motor, home, travel and pet) and life assurance products to the UK market.
Jayne Anne Gadhia, chief executive of Virgin Money said: "The financial crisis has tarnished the reputation of many UK banks. Virgin Money will provide a better, different form of banking to its customers, increasing competition in the sector. Our aim is to make ‘everyone better off' in the way we do business by offering good value to customers, treating employees well, making a positive contribution to society and delivering a growing profit to shareholders. Our approach to banking is founded on developing a sustainable, savings-based business. We see the acquisition of Church House Trust as a strong and sensible first step in delivering Virgin Money's banking ambition."