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Abbey National

Abbey National plc
Industry Financial Services
Fate Renamed under parent brand
Successor Santander UK Plc
Founded 1944
Defunct 2010
Headquarters United Kingdom
Key people
Lord Burns
António Horta Osório
chief executive
Products Banking and Insurance
Number of employees
Parent Santander Group
Subsidiaries Abbey National Treasury Services
Abbey International
Cater Allen
Slogan More ideas for your money
Website .com.abbeywww

Abbey National plc was a UK-based bank and former building society, which latterly traded under the Abbey brand name. As the former Abbey National Building Society, it was the first building society in the UK to demutualise, doing so in July 1989. The bank expanded through a number of acquisitions in the 1990s, including James Hay, Scottish Mutual, Scottish Provident and the rail leasing company Porterbrook. Abbey National launched an online bank, Cahoot, in June 2000.

In September 2003, the bank rebranded as Abbey, and in November 2004, it became a wholly owned subsidiary of the Spanish Santander Group, with a rebrand following in February 2005. In January 2010, the savings business of Bradford & Bingley was combined with the bank, and Abbey National plc was renamed Santander UK plc.[1] Prior to the takeover, Abbey National plc was a constituent of the FTSE 100 Index.


  • History 1
    • Early history 1.1
    • Demutualisation 1.2
    • Development 1.3
    • Takeover and rebrand 1.4
  • Operations 2
  • References 3


Early history

The National Freehold Land Society, officially named the National Permanent Mutual Benefit Building Society to give it legal existence under the Building Societies Act 1836, was established by two Liberal members of parliament, Sir Joshua Walmsley and Richard Cobden, in 1849, joined a year later by John Bright. In 1856, it formed the British Land Company, which separated in 1878. Meanwhile, the Abbey Road & St. John's Wood Permanent Benefit Building Society was founded in 1874, based in a Baptist church on Abbey Road in Kilburn. In 1932 the society moved into new headquarters, Abbey House, at 219–229 Baker Street, London, which it occupied until 2002. The site was thought to include 221B Baker Street, the fictional home of Sherlock Holmes,[2][3] and for many years Abbey employed a secretary charged with answering mail sent to Holmes at that address.

The Abbey National Building Society was formed following the merger in 1944 of what had become Abbey Road Building Society (already the second largest) and National Building Society (at the time the sixth largest). The Swansea Thrift Permanent transferred engagements in 1949, followed by the Definite Permanent in 1968, The State Building Society in 1970, Highgate Building Society in 1974 and the Oak Co-operative in 1979.[4]

During the 1970s and 1980s, Abbey National gained a reputation for innovation and, sometimes disruptive, change. It was an early user of computer systems and in the late 1970s, all branches became on-line to a real-time system that maintained customer accounts. Under Chief general manager Clive Thornton, new types of savings accounts were introduced as well as a cheque account. The administration of the cheque account was restricted by building society rules and the need to find a partner that could clear Abbey's cheques (The Co-operative Bank). Later, Abbey became a full member of the Bankers' Automated Clearing Services (BACS) and the former Association for Payment Clearing Services (APACS). Thornton also acted to break the building societies' interest rate consensus.


The former 'house roof' umbrella logo

The Abbey National Building Society became the first of the UK building societies to demutualise, and became a public limited company as Abbey National plc on 12 July 1989. It was floated on the London Stock Exchange at £1.30 per share, resulting in an unusually large number of small shareholders – approximately 1.8 million initially. The demutualisation process was marred by the discovery of a large number of undelivered share certificates awaiting destruction at a contractor's premises.

Abbey National shares peaked at more than £14 in 2000, before the stock market began a long decline.[5]


In 1994, Abbey National purchased James Hay, one of the UK's foremost independent providers of self-administered pensions.[6] James Hay then went on to grow in straight and launched Abbey Wrap, the first Wrap a service in which IFA’s can keep the clients ISA’s, Peps, Offshore bonds and SIPP in one place. Abbey Wrap Managers was FSA approved in 2003. This was relaunched as James Hay Wrap in 2005.[7]

In February 1995 Abbey National Baring Derivatives were taken down along with Barings Bank due to failures in regulation and control, especially in regards to Nick Leeson of Barings Bank.

Two life assurance companies were demutualised and acquired, Scottish Mutual in 1992 and Scottish Provident in 2001, which enabled Abbey to pursue the bancassurance model.[8]

In August 1996, Abbey National took over the National & Provincial Building Society, which was itself the product of a 1982 merger between the Provincial Building Society and the Burnley Building Society. This merger increased Abbey National's branch network by almost two hundred branches and brought in three million more customers.[9]

In April 2000 Abbey bought Porterbrook from Stagecoach Group for £773 million. Porterbrook was one of the three railway rolling stock operating companies created from by the privatisation of British Rail, leasing rolling stock to the UK train operating companies.[10]

The bank launched its online bank, Cahoot, in June 2000.[11]

Lloyds TSB attempted to merge with the bank in 2001, though that was ultimately rejected by the Competition Commission.[12]

Abbey also ventured into the wholesale loans business. At first this provided a good profit stream, despite the criticisms of some analysts. This eventually undid the company, however, when Enron turned out to be unsafe and the 11 September attacks in New York damaged confidence in various financial areas. From this point, Abbey struggled from financial losses and a tarnished image. The chief executive, Ian Harley, a long-time Abbey employee, resigned and his post was filled by an outsider, Luqman Arnold.[13]

Arnold spearheaded a major reorganisation of the bank in September 2003 that also saw the brand name shortened to Abbey, the domain name launched and the Abbey National umbrella logo dropped. Banking literature was also simplified as part of the programme, labelled 'turning banking on its head'.[14][15]

Takeover and rebrand

Branches of Bradford & Bingley and Abbey opposite each other on Hounslow High Street prior to the January 2010 rebranding
A branch of Abbey on Commercial Street, Leeds showing Santander marketing material in the windows in January 2010.

On 26 July 2004 Abbey National plc and Banco Santander Central Hispano, SA announced that they had reached agreement on the terms of a recommended acquisition by Banco Santander of Abbey. Following shareholders' approval at the EGMs of Abbey (95 per cent voted in favour, despite vocal opposition from most of those present) and Santander, the acquisition was formally approved by the courts and Abbey became part of the Santander Group on 12 November 2004.[16]

Francisco Gómez Roldán took over as chief executive from Luqman Arnold, who received a rumoured £5 million, made up of pay off and share options. Gómez-Roldán died suddenly in July 2006, three weeks before being succeeded by Antonio Horta Osorio.[17]

In June 2006 Abbey agreed to sell its life businesses to Resolution plc.[18] The businesses sold to Resolution were Scottish Mutual Assurance, Scottish Provident Limited and Abbey National Life, two offshore life companies, Scottish Mutual International and Scottish Provident International Life Assurance Limited. Abbey retained all of its branch based investment and asset management business, James Hay, Abbey's self-invested personal pension company and James Hay Wrap.

In July 2007 Abbey admitted that errors that it made in the 1980s have contributed to many borrowers mortgage terms being extended by up to 15 years. During this period – which saw considerable turbulence in interest rates – Abbey extended the terms on customers repayment style mortgages without their knowledge. The Financial Ombudsman Service stated that Abbey customers may be eligible for compensation.[19]

As a result of the 2008 banking crisis, Abbey purchased the savings business and branches of Bradford & Bingley in September 2008 following the nationalisation of B&B by HM Government.[20] The purchase of Alliance & Leicester by Santander had been agreed earlier that month.[1]

Abbey migrated all customer accounts to the Partenon computer software used by Santander in June 2008.[21]

On 27 October 2008 Abbey reached an agreement to sell Porterbrook to a consortium of Deutsche Bank, Lloyds TSB and Antin Infrastructure Partners.[22]

The Santander Group announced in May 2009 that Abbey and the Bradford & Bingley branch network would be renamed under the Santander brand on 11 January 2010. Credit cards issued by Abbey were the first to change to Santander.[1] The Abbey name was retained for the Abbey for Intermediaries mortgage division and was retained for a time for Abbey International before the latter was subsequently rebranded as Santander Private Banking. The Cater Allen, James Hay and Cahoot brands remained.[23]


Abbey National House, the bank's registered office in London

Abbey's registered office was in London (built on the site of the former Thames Television studios in Euston Road) and its main corporate centre in Milton Keynes. Its savings and banking administration departments were in Bradford, with mortgage centres in Thornaby-on-Tees and Whiteley (which was due to close later in 2010).[24] Abbey had Banking Contact Centres in Belfast, Glasgow, Sheffield, and Bootle. Business Banking operations, both administrative and telephony, were also based in Glasgow, having been moved from Taunton and Newport early in 2005.

Abbey previously operated contact centres in Derby, Liverpool and Gateshead. The Derby and Liverpool centres were closed as part of a cost-cutting exercise. Those jobs moved to Bangalore and Pune in India in 2003. Following the takeover by the Santander Group, the Gateshead operations also closed in March 2005.

Investments were previously branded as Inscape but were renamed Premium Investments in late 2008, provided by Santander Portfolio Management.[25] This was subsequently subsumed into the more general telephony operations and the original contact centre based in Billericay was closed in April 2009.


  1. ^ a b c "Santander scraps UK bank brands". BBC News. 27 May 2009. Archived from the original on 29 May 2009. Retrieved 23 May 2009. 
  2. ^ Brewer's Britain and Ireland, compiled by John Ayto and Ian Crofton, Weidenfeld & Nicolson, 2005, ISBN 0-304-35385-X
  3. ^ Santander. "Abbey and Sherlock Holmes". Retrieved 21 August 2015. 
  4. ^ Extract from Building Societies Yearbook 2009/10 (pp.126 & 152) Building Societies Association (retrieved 17 November 2009)
  5. ^ Miles Brignall (13 October 2007). "Demutualisation: Should you sell up now?".  
  6. ^ James Harris (10 March 2010). "IFG acquires James Hay". M&A. 
  7. ^ Article: Abbey arm gets given wrap and Sipp control Investment Advisor. 6 June 2005
  8. ^ "Abbey National to Buy Scottish Provident".  
  9. ^ Simon Rex (11 January 2010). "List of demutualised building societies".  
  10. ^ Staff writer (20 March 2000). "Stagecoach poised to sell Porterbrook".  
  11. ^ "Abbey National launches Cahoot". BBC News. 12 June 2000. 
  12. ^ "Lloyds TSB/Abbey tie-up blocked". BBC News. 10 July 2001. Retrieved 22 September 2013. 
  13. ^ "New Abbey boss facing tough task". BBC News. 18 October 2002. 
  14. ^ "'"Abbey revamp to 'turn banking on its head. Money Marketing. 2 October 2003. Retrieved 16 February 2015. 
  15. ^ Ritson, Mark (9 March 2005). "Mark Ritson on branding: Abbey - a case study in how to break a brand". Marketing Magazine. Retrieved 16 February 2015. 
  16. ^ William Kay (6 September 2004). "HBOS fury as EU backs Santander's Abbey bid".  
  17. ^ Stephen Seawright (27 September 2006). "Bad loans up at Abbey". The Telegraph (London). 
  18. ^ Hilary Osborne (7 June 2006). "Abbey sells life insurance arm". The Guardian (London). 
  19. ^ Gill Montia (2 July 2007). "Abbey Borrowers Face Lengthened Mortgage Terms". The Banking Times. 
  20. ^ Santander Group Santander (29 September 2008). "Bradford & Bingley's direct channels and retail deposits to transfer to Abbey". Retrieved 20 March 2010. 
  21. ^ Abbey completes Partenon core project Karl Flinders. Computer Weekly. 13 June 2008
  22. ^ "Porterbroook Leasing sale agreed".  
  23. ^ "Santander to rebrand UK banks". Hilary Osborne,  
  24. ^ Fran Duckett-Pike (30 March 2010). "Santander set to axe 160 jobs at Whiteley call centre".  
  25. ^ Santander UK plc. "Premium Investments: Savings: Santander". Retrieved 20 March 2010. 
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