by Gary Webber
23. October 2009 11:54
This could just be a rumour, but it looks like Virgin Money has lured a former Northern Rock chairman onto its board as it pursues a banking licence.
Virgin positioned itself as a bidder for Northern Rock before the bank's eventual nationalisation in February 2008, and it is still determined to become a High Street banking player. Now, Bryan Sanderson (chairman of Northern Rock until October 2007) has been appointed as a non-executive director to Virgin, which suggests a renewed bid for Northern Rock could be on the cards.
This time round the deal could be even sweeter - although they're certain to face competition from certain financial giants. The reason why is that government plans to split Northern Rock into a 'good' and a 'bad' bank are set to be approved. Virgin would now effectively be bidding for the icing on the Northern Rock cake: the decent assets, the worthy loans, rather than the messy leftovers of an infamous high-octane lending spree.
And one factor that will count in Virgin's favour? The Government is keen to encourage new entrants into a banking market that has seen many players disappear or raise the white flag. Virgin is hardly brand new to finance, but in the world of mortgages it has been "missing in action" for six years since passing on the One Account to RBS in 2003.
In recent years Virgin has hardly been coy about its ambition to be a High Street bank, and today it looks like it could be one step closer.
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