CYBG : confirms next stage of Virgin Money integration process

CYBG has announced the next stage of the Bank's integration programme as it brings together the operations of Clydesdale and Yorkshire Bank with Virgin Money and transitions towards using the single Virgin Money brand by 2021.

Today's announcement includes plans to rationalise some of the Group's corporate property portfolio over the next two years, as well as providing an update on the next stage in the restructuring of the business, including the removal of some roles as part of the planned integration announced during the acquisition of Virgin Money by CYBG in 2018.

Group's long-term strategy for corporate locations

CYBG is today announcing plans to rationalise the Group's corporate property portfolio over the next two years - focussing the Group's key corporate locations in Glasgow and Gosforth. While CYBG will maintain a strong presence in Edinburgh, Leeds and Norwich, the Group plans to exit some existing functional offices in those cities, transferring some roles into other sites.

As announced during the acquisition of Virgin Money, rationalising the Group's property portfolio is a vital part of successfully integrating the Group's businesses and reducing the combined overall cost base. Following a comprehensive review of its geographical footprint, the Group's long term corporate locations will be focussed around two major hubs in Glasgow and Gosforth, supported by a regional presence in Chester, Edinburgh, Leeds and London. In addition, Virgin Money Giving, Virgin Money's not-for-profit fundraising platform, will continue to be based in Norwich.

• Virgin Money's St Andrew Square office in Edinburgh is expected to close by the end of 2019 - with colleagues relocating to CYBG's existing office and branch on nearby on George Street. Virgin Money's flagship St Andrew Square lounge will remain open for customers.
• Virgin Money's Discovery House in Norwich is expected to close by the end of October 2020, with roles transferring to other locations, with the exception of Virgin Money Giving, which will continue to operate from Norwich, but will eventually move to a new location within the city.
• Yorkshire Bank's Merrion Way office in Leeds is expected to close by September 2021, with the Group consolidating its functional corporate office into its flagship store and corporate office on Briggate in Leeds City Centre, which will over time transition to the Virgin Money brand.

David Duffy, CEO said: 'The consolidation of our operating centres supports our goal to create a more streamlined and efficient business - focussing on two key operational centres in Glasgow and Newcastle, supported by teams based in Leeds, Edinburgh, Chester and London.

'Detailed planning is in place to ensure that the Bank is able to safely transfer operations to the major hubs over time, while continuing to provide the same great service for our customers every day.

'We recognise that some exit dates are quite far in the future, however, we want to be open with colleagues and give them clarity on changes as soon as possible. They are our key priority and we will support them through this change with as much choice and flexibility as possible.'

Update on Virgin Money integration and simplification of the combined business

CYBG is today also providing an update on a number of other role reductions across the wider company as part of the planned Virgin Money integration process. These changes are designed to simplify structures, reduce duplication and clarify accountabilities across business areas.

The impacted teams (based across the UK) include Brand & Marketing, Retail Distribution, Chief Operating Office, Risk and Mortgages, where we are moving to the Virgin Money operating model of providing mortgage advice by telephone and online, in line with the growing trend in the market for telephone appointments and online mortgage applications.

As a result of the changes above, a number of roles are at risk of redundancy and colleagues will be supported through the Bank's redeployment process, with the aim of minimising compulsory redundancies wherever possible.

A reduction of around 330 Full Time Equivalent (FTE) roles is anticipated as a result of these changes. These role reductions are part of the forecast reduction of c.16% of FTE roles across the combined Group, which CYBG announced during the acquisition of Virgin Money in 2018.

Today's update on role reductions does not include the planned closure of Yorkshire Bank's Merrion Way office in 2021. The Group will use the following two years to work through the impact of the changes in Leeds, including transfer and redeployment options for employees currently based in Merrion Way.

No changes to any customer facilities have been announced as part of these changes.