CHALLENGER banks will fail to make a real impact on the UK lending market in the coming years, with the big four banks still firmly in control, Barclays’ chief Antony Jenkins told investors yesterday.
Politicians and regulators are keen to promote competition in the sector by selling chunks of Lloyds and RBS.
But Jenkins said expanding this way is not attractive as branch-based services are declining in favour of online banking.
“There are a large number of branch networks up for sale in the UK, but branch banking itself is undergoing a transformation. Branch networks are shrinking, it would mean buying a wasting asset,” Jenkins warned.
Virgin Money, which expanded rapidly by buying part of Northern Rock, hit back at the claims.
“Since the acquisition last year we have opened 1.4m new customer accounts – the early signs are we have got the brand and the approach that can take on the big players,” said a spokesman.
“The landscape is changing – it won’t happen overnight, but it is coming.”