08 October 2003

Post Office to offer own-brand loans and mortgages

The Post Office and Bank of Ireland have announced a joint venture which will see the creation of Post Office-branded financial products, such as mortgages and loans, launched early in the New Year.

The venture will be owned equally by Post Office and Bank of Ireland Group and has an initial term of 10 years. Each shareholder will be offered board representation on the other’s board of directors, subject to the relevant corporate governance procedures.

The Bank of Ireland Group will invest £125 million and provide the core infrastructure and start up costs. The bank will also provide or source the product range, which will be distributed through the Post Office network.

Through the Post Office branch network, and via the telephone and website, customers will be now offered personal loans, savings accounts, credit cards, personal insurance and mortgages.

David Mills, Chief Executive, Post Office, said: “Customers know that the Post Office and its people provide them with reliable service and they trust us. Our new range of products will have great appeal and I expect Post Office Ltd to become a major provider of personal finance services. This is great news for our customers, as our employees and subpostmasters throughout the United Kingdom will be able to offer a much enhanced range of products.”

Post Office branches serve approximately 29 million people who make some 42 million visits to branches each week; 27 pence in every £1 in circulation passes through a Post Office branch.

The decision was made following 18 months of market research in which 20,000 customers were surveyed.

(gmcg)