Stornoway’s Lloyds Bank is to be sold to The Co-operative Group as part of national multi million pound deal.
The Co-operative Group has agreed to buy the Verde business from Lloyds Banking Group - which includes 632 branches - in what has been hailed as the biggest shake-up in high street banking in a generation.
Over £4million Lloyds customers across the UK will be transferred to the Co-op.
The deal is expected to be completed by the end of November.
The Lloyds Scotland branches are to be rebranded as TSB and sold under that name.
Peter Marks, Group Chief Executive of The Co-operative Group, said:
“We’re delighted to be announcing that we have reached agreement in principle with Lloyds Banking Group on the terms of this important and transformational transaction. This deal would deliver the biggest shake-up in high street banking in a generation. Consequently, we believe this would be a great deal for customers, for the public, for UK banking generally and for The Co-operative Group, in particular.
“It would be a great deal for customers because it would make the services of our member-owned, customer-led, ethically-driven, bank available to millions of people we’ve not been able to serve up until now.
“It would be a great deal for the taxpayer because as well as receiving a fair price up front, the deal would also mean they would share in the profits of the enlarged bank for years to come.
“So far as UK banking generally is concerned, this would be a great deal because it would help restore trust in a sector whose image has been badly tarnished over recent years.
“And finally, it would be a great deal for The Co-operative Group, its 20 million customers, its seven million customer-owners and its 100,000 staff, because it would propel us into the premier league of UK banking.
“The acquisition of the Verde business would significantly advance our growth strategy, creating a combined bank approaching 7% market share of UK personal current account customers. That would allow us to really challenge the status quo on the high street.
“Despite the crisis in the financial sector, our bank has continued to go from strength to strength, coming through the financial crisis in great shape and maintaining our ethical and socially responsible credentials. Whilst we are not at the end of the road yet, we are pleased to have reached this important milestone and look forward to continuing to work with Lloyds Banking Group to reach a final agreement.”