Clydesdale Yorkshire Banking Group (CYBG) is targeting extra cost savings as part of its planned Virgin Money rebrand.
Clydesdale says that it is kicking off the Virgin Money re-brand later this year. The first brand to be dropped is the digital sub-brand dubbed B.
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The B brand was only launched by CYBG in 2017.
On acquiring Virgin Money, CYBG said it would adopt a single brand under the Virgin Money moniker.
The three CYBG brands will be re-named Virgin Money by the end of 2019. The re-launch of the Virgin Money brand and rebranding of the business will begin in late 2019.
On the other hand, Clydesdale is to continue issuing banknotes in Scotland.
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By GlobalDataAlong with RBS and Bank of Scotland, Clydesdale retains the right to issue its own Clydesdale branded banknotes.
Clydesdale wrapped up the acquisition of Virgin Money last October. The all-share deal, valued at £1.7bn ($2.2bn) created the sixth largest bank in the UK.
CYBG originally targeted pre-tax run rate cost synergies of £120m by the end of the third year post completion.
CYBG revised targets following Virgin Money rebrand
The newly rebranded Virgin Money is to target growth in business and unsecured consumer lending, rather than the mortgage market.
In particular, CYBG is aiming for strong growth in relationship deposits. It believes it can deliver high single digit CAGR in personal and business current account and linked savings balances.
Specifically, on margins, Clydesdale re-affirms 2019 guidance and forecasts a net interest margin of 165-170 basis points.
But on cost savings, CYBG is raising the bar. It now targets £200m of cost savings by fiscal year 2022. This represents an additional £50m of net cost savings from the CYBG Transformation Programme. CYBG targets a CET1 capital ratio of around 13%.
