🔔 When two become one - Clydesdale Bank and Virgin Money to merge their FSCS licences

In October 2018, Virgin Money plc (Virgin Money) was bought by Clydesdale Bank PLC (Clydesdale), although the Virgin Money brand has been retained – and will continue going forward. As well as Virgin Money, Clydesdale Bank PLC also trades as “Clydesdale Bank”, “Yorkshire Bank” and “B”.

Until now this merger has made no difference to Virgin customers – including the protection afforded to them under the Financial Services Compensation Scheme (FSCS).

However, to bring the two businesses together under the same banking permissions, the group is transferring Virgin Money products over to Clydesdale and this is expected to happen on 21 October 2019.

For existing Virgin Money customers, it’s still unlikely that you’ll notice much difference, although the Clydesdale Bank name will be included on any documentation received. Account numbers, account features and contact details will remain the same, as will any sign-in details you use in its online services.

But the key difference will be that there will no longer be two separate FSCS licences.

At the moment, the FSCS covers each financial institution; Virgin Money and Clydesdale Bank. But, after the transfer, all Virgin Money and Clydesdale Bank, Yorkshire Bank and B branded products will be provided by Clydesdale Bank plc, so only one protection limit will cover Virgin Money and Clydesdale Bank, Yorkshire Bank and B branded savings.

This means that the £85,000 limit per customer applies to all funds held with all four of the above brands. For example, if you hold £85,000 with Clydesdale Bank and £85,000 with Virgin Money, after 21 October 2019, half of your cash will no longer be protected by the FSCS.

So, what can you do about this?

You may need to review your savings accounts to make sure that you don't expose some of your savings to the risk of no protection.

If you find that after the merger, you have some money unprotected, you may want to move some of your cash to another provider. If that is the case, Clydesdale Bank are allowing customers to move money (either from Clydesdale Bank products, or Virgin Money accounts) even if they are not normally be able to access it – and to do this without any penalty or losing accrued interest (for example if you hold a fixed rate product you can withdraw funds before the maturity date without penalty).

But you will only have three months from the date of the business transfer, which is expected to be 21 October 2019. And you can only remove funds without incurring a penalty, to take your total balance down to the £85,000 FSCS limit (£170,000 if it is in joint names).

Of course, you will still be able to withdraw funds from any easy access accounts, under the normal Terms & Conditions, after the three months have elapsed. Beware of restricted access accounts such as the Virgin Money Double Take E-Saver, as although any withdrawal made within the three month window will not count as one of the allowed withdrawals, the T&Cs will apply as normal after the three months have passed since the transfer.

How do you request a withdrawal from your Virgin Money accounts?

You can ask for a withdrawal in the following ways:

For non-online accounts

Write to Savings Operations, Virgin Money, Jubilee House, Gosforth, Newcastle upon Tyne NE3 4PL.

Or visit your local Virgin Store - they'll send your request to the Main Office.

You’ll need to include the following:

• Full name(s) and address of the account holder(s).
• Account number(s) of the account(s) you're taking the money from.
• Amount(s) you want to withdraw.
• How you want the money paid i.e. cheque made payable to you or a Faster Payment. For a Faster Payment, you'll need to give details of the account you're sending the money to, including the sort code and account number. This account must be in your name (for withdrawals from Virgin Money joint accounts, it must be in both or either name).
• All people named on the Virgin Money account must sign the request.

For online accounts

Email Virgin Money using the 'Messages' option, once you've signed into your account. All online withdrawals will be sent to your registered nominated bank account, unless you request an ISA transfer.

If you'd like to take money out of one of your Clydesdale Bank, Yorkshire Bank or B branded account(s), please contact them in the usual way.

For a full list of Questions and Answers, take a look at the comprehensive list that Virgin Money has put together.