Sainsbury's is closing in on full ownership of Sainsbury's Bank. The supermarket giant confirmed this morning that it will take control of the bank by buying the 50 per cent held by partner Lloyds Banking Group in a £248 million deal.

Sainsbury's was the first major British supermarket to open a bank, launching in 1997 in a 50/50 joint venture with Bank of Scotland, later subsumed by Lloyds. It says that this latest move gives it the opportunity to increase its number of customers and enhance loyalty by offering accessible, high quality and tailored products which reward customers who bank and shop with it.

Over a 42 month period, the bank will transition support and back office services away from Lloyds Banking Group. Call centre services will be provided in-house by the bank and banking platforms will be delivered by FIS. All parties have been working together for a number of months to agree a detailed transition plan.

According to a statement issued by Sainsbury's: "The transition will involve the transfer of data from legacy Lloyds Banking Group systems to the latest generation banking platform. This platform will allow a greater degree of flexibility, enabling new product launches and facilitating a much improved digital offer to customers."

Justin King, chief executive, says: "This is an exciting transaction for Sainsbury’s which has the potential to deliver significant benefits to our shareholders, customers and colleagues. We have 23 million transactions each week by customers who know and trust the Sainsbury’s brand. We see a great opportunity to increase the number of Bank customers by offering accessible, high quality financial services products which reward customers who bank and shop with us. We expect the Bank to become an important source of profit diversification and growth, building on the strengths of our core business."

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