Two more banks to merge

[Endsmeet]

Spanish bank Santander has agreed a deal to buy UK lender Alliance & Leicester (A&L) for about #163;1.26bn.
Santander plans to merge A&L with Abbey

Just seen this on the BBC website and I was just thinking, how will this affect people with A&L accounts who were with the Abbey pre IVA?

I know that the A&L are one of the banks who accepted IVA'rs so once they are 'merged' will they be able to take peoples wages (who Abbey are owed monies pre IVA) etc using the right to offset rule?

[quark2008]

I've been thinking that. I bank with A&L.Carefully considering my options i think.

[quark2008]

Maybe Melanie can answer this question ?

[MelanieGiles]

The right of offset will probably only affect new accounts rather than existing ones - at least this is what happened when Lloyds and the TSB merged.

[quark2008]

Thanks Melanie, i am a bit concerned to be honest, the last thing i need is to have all my money taken, when i am just starting to begin again.If they were to implement the right to offset, what exactly would happen with my account ?

[MelanieGiles]

Technically they could take the money in your current account and use it to pay off balances on loan or credit card accounts - but only prior to you entering into an IVA or declaring yourself bankrupt. I suppose they could refuse to allow you to continue banking with them, but I am sure that this will not happen so please don't worry unduly.

[quark2008]

Thanks very much, mind at rest.

[Endsmeet]

So they can't use the right to offset rule once you are actually in an IVA situation?

[MelanieGiles]

No

[Endsmeet]

Thanks for clarifying that Melanie,
So it means that the worse that can happen if you already have an account with someone and they merge/taken over is that they can close your account down?

[MelanieGiles]

I cannot speculate further on what might happen when these two banks actually merge. You will need to wait and see if there are any announcements and I am sure that they will write to you in any case if they have concerns about retaining you as an account holder.

[Endsmeet]

Thanks again Melanie,
Lets hope that the co-op don't have any plans to merge in the foreseeable future....