Customers face fall-out from bank changes

09/11/2009

Customers with bank accounts in part-nationalised banks might have to re-register in order not to be transferred to a new firm, a government representative has confirmed.

A spokesman for the Treasury told the Sunday Times newspaper that people whose local branch changes ownership due to the break-up of the Lloyds Banking Group and RBS need to assign themselves a new sort code if they want to stay with their previous provider.

However, he added that the move would not affect the customer's financial position and that the transfer would be free of charge.

Both large banking groups, partly owned by the taxpayer after the 2008 bailouts, will undergo a radical restructuring under plans announced last week.

Lloyds, made up of Lloyds TSB and HBOS, is to reduce its share of the current account market from 28% to 25% by selling off businesses to the private sector.

Several new firms, including the old high street presence TSB, are likely to be reintroduced as a result.

Branches will also be sold off by RBS, owners of NatWest.

Customers' bank will be determined by whether or not their "local" branch is sold off or not.

This branch can be looked up through their card's sort code.

The spokesman said: "Customers will be entitled to open a new account with their old provider free of charge and with no fuss.

"We expect that customers' account numbers and direct debts will remain unchanged. Benefit payments, tax credits and wages will all be paid into accounts in the normal way."

Tags; Debt Management and Banking, Young Family Finances, Retirement Money Problems, Credit Card Lifestyle, Recent Graduate Debt,

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