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Nationwide/Virgin Money

Journalist: Anna Sagar, Mortgage Solutions / Specialist Lending Solutions

ended 09. March 2024

Looking to get views from mortgage brokers about Nationwide agreeing to buy Virgin Money for £2.9bn. 

  • Do you think this is a good decision? If so, why or why not? 
  • Will there be more lender M&A/consolidation? Is this a good thing? 

4 responses from the Newspage community

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Ben Perks
Managing Director at Orchard Financial Advisers
This is a great aquisition for Nationwide. Virgin are a good brand with differing criteria so the two organisations should compliment each other nicely. If they get it right they should be able to offer a wider range of options to borrowers which could spark some serious competition for customers with rival lenders and this will benefit borrowers greatly.
I think we will see more mergers and aquisitions going forward, we know Coventry are alreay in talks with Co-op for example. These deals can be positive as the greater scale will allow lenders to be less risk averse and reach out to new cutomers and sectors. The deeper pockets can also improve systems and processes. But ultimately it creates less choice for the consumer which is concerning.
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Mark Robinson
Managing Director at Albion Forest Mortgages
Whether this is a good decision is dependant on whether Nationwide continue the brand, as Virgin have differing criteria to Nationwide, making them useful for some applicants that may not fit with Nationwide.
Should Nationwide incorporate Virgin Money and Virgin disappears, this could leave some people that may have been able to be approved with Virgin, that won't with Nationwide.
However, that is a long term issue, usually when buying a company it would continue to function as it's own entity for a period of time at the very least.
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Richard Jennings CeMAP
Founder & Managing Director at Richard Jennings Mortgage Services
In the immediate short term this will be business as usual, the details of the offer confirm the VM brand will continue for 6 years and so I would hope this means the seperate lending criteria's continue in this way. Its a surprising move by VM to consider a purchase offer from Nationwide having only recently being bought by Clydesdale Bank.

The staff I am sure at anxious at this time , as with any acquisitions a period of alignment of functions usually results in job losses.

I can see a few of the smaller/challenger lenders being eaten up by larger lending institutions, which from a market and client point of view can only be a negative.

Often these smaller lenders, who are unable to compete on rate alone, offer unique lending solutions that ensure clients can enter the housing market via routes the larger "computer says no" lenders don't accommodate for.
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Akhil Mair
Director at Our Mortgage Broker
Nationwide's decision to acquire Virgin Money for £2.9 billion appears to be a strategic move aimed at expanding its market presence and diversifying its offerings. Consolidation in the lending industry is not uncommon and can lead to cost efficiencies and improved competitiveness. However, the success of this acquisition will depend on Nationwide's ability to integrate Virgin Money effectively and back office synergies. As for future lender M&A, it's possible we'll see more consolidation as companies seek economies of scale and enhanced market positioning. Whether it's a good thing depends on how well it's executed and its impact on competition and consumer choice.