UK supermarkets group Sainsbury’s has hired former senior AIB executive Robert Mulhall to take charge of its banking unit, as it seeks to gradually wind down or sell the business almost 27 years after it was launched.
Mr Mulhall, a former head of AIB’s Irish retail and UK divisions, left the second-largest Irish domestic bank by assets in August, 2022 and subsequently joined management consulting firm Vision Consulting. He will take on his new role in March, succeeding Jim Brown, a former chief executive of Ulster Bank.
Sainsbury’s said on Thursday that, following the completion of a strategic review of its financial services division, it will wind down its banking business and instead offer financial products through third parties, as part of a strategy to focus on its core retail operations.
The group is also said to be open to taking offers for the banking business, which it has wholly owned for the past decade and which it had previously sought to sell in 2020 at a time when its profits were under pressure in an ultra-low interest rates environment.
“Financial services products that we continue to offer in the future will be provided by dedicated financial services providers through a distributed model. We already do this successfully with our insurance products. Over time this will result in a phased withdrawal from our core banking business,” Sainsbury’s said in a statement.
“There will be no immediate changes to the products or services that we provide to our customers.”
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In August, Sainsbury’s Bank sold its mortgage portfolio, which comprised 3,500 customers and balances of about £479 million (€558 million), to the UK-based Co-operative Bank.
“Robert is an experienced retail banking leader with a strong track record of delivering successful transformation,” Sainsbury’s said in the statement, adding that Mr Mulhall’s appointment remains subject to regulatory approval.
Fellow UK retailer Tesco put its banking arm on the market late last year and has reportedly fielded bid interest from the likes of HSBC, Barclays and Lloyds Banking Group.
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