Barclays Bank plc / ING Direct NV
| Case Outcome | Mergers - phase 1 clearance |
| Decision Date | 05 February 2013 |
| Date | 05 February 2013 |
| Subject Matter | Mergers |
| Court | Competition and Markets Authority (EW) |
Anticipated acquisition by Barclays Bank plc of certain assets of ING
Direct N.V., including its UK retail savings and residential mortgage
businesses
ME/5746/12
The OFT’s decision on reference under section 33(1) given on 17 January 2013.
Full text of decision published 5 February 2013
Please note that the square brackets indicate figures or text which have been
deleted or replaced in rang es at the request of the parties or third parties for
reasons of commercial confidentiality.
PARTIES
1. Barclays Bank PLC (Barclays) is the operating company of the Barclays
Group, a UK provider of retail and business banking services, including
current account, savings, loans and mortgage services through a network
of branches, as well as phone and online banking services.
2. ING Direct N.V. (The Vendor), headquartered in the Netherlands, is a
provider of retail and business banking services in a number of countries in
Europe and Australia. It is a wholly-owned subsidiary of ING Group N.V.
3. ING Direct UK (Direct UK) is a branch of the Vendor, and is a direct
banking platform, providing savings and mortgage services to personal
customers and savings services to business customers in the UK through
online and mobile internet and telephone channels. As at 31 March 2012,
Direct UK had mortgages assets of £[ ] billion, savings liabilities of £[ ]
billion and [ ] million customers. In the 2011 financial year Direct UK
generated UK turnover of approximately £[ ] million.
TRANSACTION
4. On 9 October 2012, the parties signed an agreement pursuant to which
Barclays will acquire certain assets of the Direct UK business (the Target).
The Target was offered for sale as an asset and liability transfer under Part
1
VII of the Financial Services and Markets Act 2000. Direct UK’s staff will
transfer to Barclays under the TUPE regulations.1
The ING Direct brand
name is not part of the transaction.
5. The transaction was notified to the Office of Fair Trading (OFT) on 1
November 2012. Following receipt of a satisfactory submission on 14
November, the administrative deadline for a decision is 17 January 2013.
JURISDICTION
6. As a result of this transaction Barclays and Direct UK will cease to be
distinct. The UK turnover of Direct UK exceeds £70 million, so the turnover
test in section 23(1)(b) of the Enter prise Act 2002 (the Act) is satisfied.
The OFT therefore believes that it is or may be the case that arrangements
are in progress or in contemplation which, if carried into effect, will result
in the creation of a relevant merger situation.
MARKET DEFINITION
7. The parties overlap in the provision of retail savings/deposit products to
personal customers and small and medium-sized business (SME)
customers, and in the provision of residential mortgages in the UK.
Product scope
Customer type
8. Barclays submitted that the OFT should not depart from the market
definition used in previous cases,2
1 Transfer of Undertakings ( Protection of Employmen t) Regulations 2006.
which typically segmented the market
first by customer type and then by product type. In particular Barclays
pointed to the Competition Commission’s (CC’s) Report on the Lloyds
2 See Lloyds TSB Group plc and A bbey National plc: A report o n the proposed merger,
Competition Commissio n, July 2001;
Anticipated acquisitio n by Lloyds TSB plc of HBOS pl c - Report to the Secretary of State for
Business Enterprise and Regulat ory Reform , OFT, 24 October 2008; and
Decision by Lord Mandels on, the Secretary of State for Business, not to refer to the Competition
Commission the merger bet ween Lloyds TSB Group plc and HBOS plc under Sectio n 45 of the
Enterprise Act 2002 dated 31 Octo ber 2008. www.bis.gov.uk/files/file48745.pdf .
2
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