TSB welcomed back to UK high street as Lloyds splits its banks
After failed bid from Co-op, Lloyds turns to 'Plan B' and reopens TSB as a separate bank
THE TSB bank will return to British high streets today, as 631 Lloyds branches are reopened with a new identity.
After nearly 20 years together, Lloyds and TSB are going their separate ways. More than 4.6m Lloyds customers and around 8,500 staff are being switched to the new bank, under the ownership of Lloyds Banking Group until it is sold next year.
Founded in 1810 as the Trustee Savings Bank by the Reverend Henry Duncan, TSB merged with Lloyds in 1995. It will become Britain's eighth largest high street bank after its relaunch.
Lloyds, which is 39 per cent owned by the taxpayer, is also getting a new image. The remaining 1,300 Lloyds TSB branches will be rebranded as Lloyds Bank but will not be officially unveiled until 23 September. Both "new" banks are being backed with multimillion-pound marketing campaigns: £30m has been spent on TSB's rebranding and advertising, The Guardian reports.
The European Commission ordered the sale as part of the conditions of Lloyds Banking Group's 2008 bail-out. Earlier this year, a planned sale of the 631 branches to the Co-operative group fell through, forcing Lloyds to resort to its 'Plan B'. It now looks increasingly likely that the TSB network will be floated on the stock market as a separate bank.
The banking giant's chief executive, Antonio Horta-Osorio, assured customers that the only real thing they would notice is the name change and described TSB as a "completely clean" bank, untainted by the recent financial turbulence seen at the UK's top banks.
Horta-Osorio added that TSB will be a "real challenger on the high street". The move will be welcomed by the government, which has been calling for more competition among Britain's high street banks.
However, analysts have warned that in order to present itself as a serious competitor on the high street, TSB must come up with something really innovative.
Richard Lloyd, executive director of the consumer organisation Which?, said: "The current account market desperately needs more competition, and TSB has a golden opportunity to offer something different to attract new customers." ·