James Moore: Sainsbury's has its work cut out if it's going to make banking taste better

Outlook Bank well for less. Is that going to be the slogan for the new Sainsbury's Bank? New Sainsbury's Bank, you say. But hasn't the show been on the road for 16 years? In fact, wasn't Sainsbury's the first supermarket to dip its toes in these waters?

Indeed it was. But since then dipping its toes in the water is all Sainsbury's has been doing. The price tells you that: the supermarket bought out Lloyds Banking Group from their joint venture for the princely sum of £248m, which amounts to tuppence ha'penny in banking terms.

Sainsbury's Bank was originally created as a joint venture with Bank of Scotland. It made a lot of sense for the two to partner up: BoS didn't have much business outside Scotland while Sainsbury's did, but didn't know much about banking.

The marriage made less sense after BoS merged with Halifax to form HBOS (now part of Lloyds), a business which had lots of customers south of the border, but which made no sense at all towards the end of its life.

Sainsbury's didn't make much sense either for a while in the noughties. Even when it started to turn around management had a fair few challenges to deal with, private-equity takeover bids for starters.

So perhaps it's no wonder that the financial services arm rather drifted. That could change, as a resurgent retailer eyes new horizons now that the core business is humming.

But can Sainsbury's make banking taste better? It remains to be seen.

Sainsbury's is good at customer service, something most banks struggle with. But it will need to show customer TLC is not inimical to banking if the business grows and hires lots of bankers to run it. And it will have to hire bankers: regulators want to have people with experience overseeing banks. Bankers aren't much good at banking, as we've learned to our cost, but retailers can sometimes be even worse. The man in at the helm when HBOS hit the rocks was a retailer: Andy Hornby. Like all retailers, he was good at selling things. But selling lots of loans can get you into lots of trouble if you haven't sold lots of people on depositing with you when the money markets dry up.

Justin King, pictured, has made Sainsbury's a force again, of that there is no doubt. But this is a new frontier he's opening up. Sainsbury's has work to do to get its bank even to the level of Tesco's equivalent, which offers a wider range of products and is now contemplating current accounts.

There is considerable goodwill behind him doing that: those regulators, and their political masters, are desperate for new entrants to reduce the dominance of the big four banks. While Sainsbury's bank is 16 years old, it almost counts as a new entrant if it plans to make a real go of it.

But while that goodwill is nice, for Sainsbury's Bank to succeed it needs the focus and commitment of its parent. Sainsbury's Bank needs the TLC if it's to generate fan mail.

News
In 2006, Pluto was reclassified as a 'dwarf planet'
scienceBut will it be reinstated?
Voices
voicesI like surprises - that's why I'm bringing them back to politics, writes Nigel Farage
News
Destructive discourse: Jewish boys look at anti-Semitic graffiti sprayed on to the walls of the synagogue in March 2006, near Tel Aviv
news

As anti-Semitic attacks rise, Grant Feller re-evaluates his identity

Arts and Entertainment
Adam Levine plays a butcher who obsessively stalks a woman in Maroon 5's 'Animals' music video
music'Animals' video 'promotes sexual violence against women'
PROMOTED VIDEO
News
people Biographer says cinema’s enduring sex symbol led a secret troubled life
News
newsGlobal index has ranked the quality of life for OAPs - but the UK didn't even make it into the top 10
News
people

Kirstie Allsopp has waded into the female fertility debate again

News
The moon observed in visible light, topography and the GRAIL gravity gradients
science

...and it wasn't caused by an asteroid crash, as first thought

News
people
Life and Style
food and drink

Savoury patisserie is a thing now

News
ebooksAn unforgettable anthology of contemporary reportage
News
Researchers say a diet of fatty foods could impede smell abilities
scienceMeasuring the sense may predict a person's lifespan
Sport
footballArsenal 4 Galatasaray 1: Wenger celebrates 18th anniversary in style
News
Gillian Anderson was paid less than her male co-star David Duchovny for three years while she was in the The X-Files until she protested and was given the same salary
people

Gillian Anderson lays into gender disparity in Hollywood

News
peopleStella McCartney apologises over controversial Instagram picture
Life and Style
Laid bare: the Good2Go app ensures people have a chance to make their intentions clear about having sex
techCould Good2Go end disputes about sexual consent - without being a passion-killer?
Latest stories from i100
Have you tried new the Independent Digital Edition apps?
Independent Dating
and  

By clicking 'Search' you
are agreeing to our
Terms of Use.

iJobs Job Widget
iJobs Money & Business

Trainee Recruitment Consultant - Birmingham - Real Staffing

£18000 - £23000 per annum + Commission: SThree: Real Staffing are currently lo...

Trust Accountant - Kent

NEGOTIABLE: Austen Lloyd: TRUST ACCOUNTANT - KENTIf you are a Chartered Accou...

Graduate Recruitment Consultant - 2013/14 Grads - No Exp Needed

£18000 - £20000 per annum + OTE £30000: SThree: SThree are a global FTSE 250 b...

Law Costs

Highly Competitive Salary: Austen Lloyd: CITY - Law Costs Draftsperson - NICHE...

Day In a Page

Italian couples fake UK divorce scam on an ‘industrial scale’

Welcome to Maidenhead, the divorce capital of... Italy

A look at the the legal tourists who exploited our liberal dissolution rules
Tom and Jerry cartoons now carry a 'racial prejudice' warning on Amazon

Tom and Jerry cartoons now carry a 'racial prejudice' warning on Amazon

The vintage series has often been criticised for racial stereotyping
An app for the amorous: Could Good2Go end disputes about sexual consent - without being a passion-killer?

An app for the amorous

Could Good2Go end disputes about sexual consent - without being a passion-killer?
Llansanffraid is now Llansantffraid. Welsh town changes its name, but can you spot the difference?

Llansanffraid is now Llansantffraid

Welsh town changes its name, but can you spot the difference?
Charlotte Riley: At the peak of her powers

Charlotte Riley: At the peak of her powers

After a few early missteps with Chekhov, her acting career has taken her to Hollywood. Next up is a role in the BBC’s gangster drama ‘Peaky Blinders’
She's having a laugh: Britain's female comedians have never had it so good

She's having a laugh

Britain's female comedians have never had it so good, says stand-up Natalie Haynes
Sistine Chapel to ‘sing’ with new LED lights designed to bring Michelangelo’s masterpiece out of the shadows

Let there be light

Sistine Chapel to ‘sing’ with new LEDs designed to bring Michelangelo’s masterpiece out of the shadows
Great British Bake Off, semi-final, review: Richard remains the baker to beat

Tensions rise in Bake Off's pastry week

Richard remains the baker to beat as Chetna begins to flake
Paris Fashion Week, spring/summer 2015: Time travel fashion at Louis Vuitton in Paris

A look to the future

It's time travel fashion at Louis Vuitton in Paris
The 10 best bedspreads

The 10 best bedspreads

Before you up the tog count on your duvet, add an extra layer and a room-changing piece to your bed this autumn
Arsenal vs Galatasaray: Five things we learnt from the Emirates

Arsenal vs Galatasaray

Five things we learnt from the Gunners' Champions League victory at the Emirates
Stuart Lancaster’s long-term deal makes sense – a rarity for a decision taken by the RFU

Lancaster’s long-term deal makes sense – a rarity for a decision taken by the RFU

This deal gives England a head-start to prepare for 2019 World Cup, says Chris Hewett
Ebola outbreak: The children orphaned by the virus – then rejected by surviving relatives over fear of infection

The children orphaned by Ebola...

... then rejected by surviving relatives over fear of infection
Pride: Are censors pandering to homophobia?

Are censors pandering to homophobia?

US film censors have ruled 'Pride' unfit for under-16s, though it contains no sex or violence
The magic of roundabouts

Lords of the rings

Just who are the Roundabout Appreciation Society?