Virgin has opened the doors to its London Lounge, in the heart of the ‘Theatre District’ of the West End of the city. It offers private banking standards level of comfort exclusively for the use of its mass market customers and membership is free. Douglas Blakey reports
Virgin Money’s London lounge has become the fourth concept outlet to open following successful lounge openings in Edinburgh, Manchester and Norwich; additional lounge openings are slated for the second half of 2014.
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Designed by UK-headquartered design consultants allen international, the Virgin Money lounges have been designed to offer customers and their guests a memorable experience in attractive and comfortable surroundings.
According to allen international, each of the lounges will offer unique features.
The London outlet, a short walk from Piccadilly Circus tube station, includes a ‘sky lounge’, complete with Virgin Atlantic first class seats and windows, where customers can recline and take advantage of an in-flight entertainment system.
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By GlobalDataThere is also a traditional ‘red London telephone box’ where customers may make calls.
All Virgin Money Lounges offer free refreshments and snacks, use of iPads, free wi-fi access, TVs, daily newspapers and magazines, and facilities to help keep children entertained.
They also offer a work space for customers with informal areas available for customers looking to hold a business meeting.
In keeping with Virgin Money’s ambition to make ‘everyone better off’, lounges are also available free of charge for community events, charity meetings and fundraising activities.
The lounges complement Virgin Money’s existing branch network of 75 outlets. It ended 2013 with around 1.2m retail banking customers; it currently has around 20.4bn of loans on its balance sheet, with mortgages accounting for 19.6bn of this figure.
Virgin Money highlights in 2013 include:
- Statutory profit before tax of £179.4m in 2013, after £150.6m in 2012;
- Total assets increased by 13% year-on-year to £24.6bn;
- Net interest margin increased to 1.26% in 2013 from 0.54% in 2012;
- Retail savings increased by 17% to £21bn;
- Net lending of £2.8bn in 2013 making Virgin the, third largest net mortgage lender during 2013 based on Funding for Lending data;
- Virgin acquired £credit card balances of £1bn from MBNA to kick-start Virgin Money’s own cards business.
The launch of the much anticipated first current account product from Virgin Money will grab the attention of the UK consumer press in 2014; the debut current account is currently being trialled by Virgin employees.
For challenger banks such as Virgin (not to mention Tesco Bank, Sainsbury’s Bank, Metro Bank and One Savings) there is much to play for.
Analysts at investment bank Jefferies forecast that the established Big Five banks will cede around four percentage points of market share to the new challengers, opening up a loan pool of £100bn and revenue of around £5bn within the next five years.
Jefferies forecast that the UK retail banking sector growth will be around +4% deposit CAGR and +2% lending CAGR until 2018.
