TIDMVMUK TIDM91XR
RNS Number : 4621N
Virgin Money UK PLC
30 September 2021
VIRGIN MONEY UK PLC
(Group or Virgin Money UK)
LEI: 213800ZK9VGCYYR6O495
30 September 2021
Virgin Money UK updates on the acceleration of its digital
strategy
As outlined at Virgin Money UK's H1 results in May, the Group
has been evaluating the opportunities to accelerate its digital
strategy enabling greater efficiency and driving up levels of
digitisation across the bank to further develop a strong, scalable
platform for future growth.
Emerging from the pandemic, the Group continues to see greater
appetite for digital self-service, with customers increasingly
adopting digital channels. The Group also continues to evolve its
operating model to reduce real estate costs along with giving
colleagues more flexibility, and to take opportunities to increase
automation, leveraging technology throughout key processes.
As Virgin Money UK comes to the end of its Integration and
Transformation programmes, the Group is accelerating the next phase
of its strategy and increasing the level of investment in digital
initiatives. As a result, restructuring charges for FY21 are now
expected to be c.GBP145m in total with an additional c.GBP45m
booked in Q4, as the Group launches the initial actions in order to
deliver on its strategic ambition to be the UK's best digital
bank.
There are three key elements to be accelerated:
- Store closures: During COVID-19 the Group has seen a shift in
sales volumes and communications to digital and mobile channels,
with lower branch footfall. As part of its review, the Group has
identified 31 stores out of the 162 in its network which will be
closed over the coming months. As a result, the Group will take a
c.GBP25m restructuring charge in Q4.
- Life More Virgin target operating model changes: The Group's
Life More Virgin working model aims to give colleagues greater
flexibility around working patterns and location, seeking to
support colleagues to achieve a better work-life balance and boost
well-being and productivity. The changes also mean the Group will
have lower office space requirements, with infrastructure and
office hubs re-purposed to fit new ways of working. After applying
valuation adjustments and including other operating model changes,
the Group will incur a c.GBP20m restructuring charge in Q4.
- Greater automation: Having delivered Integration, the Group is
now aiming to further simplify the IT estate by moving to
cloud-based infrastructure which will streamline and automate key
processes. These changes will further enable agile delivery,
increasing the pace of change and delivering efficiency benefits
over time.
The steps announced today are the first phase of the
acceleration of Virgin Money UK's digital strategy, which will
drive further productivity gains and build capacity for ongoing
re-investment, further digitisation and in time, greater cost
efficiency.
The Group's digital strategy will further develop a strong,
scalable platform for future growth. In the near term, cost savings
from improved productivity delivered by Virgin Money UK's digital
initiatives will be reinvested into the business to further
accelerate the pace of platform development. Virgin Money UK will
also leverage the capabilities of its key strategic partnerships,
such as those announced with Global Payments and Capita, to deliver
additional features and differentiated propositions for customers.
The Group will provide additional detail on the efficiency benefits
and investment opportunities as well as its growth ambitions
alongside its Full Year results.
Announcement authorised for release by Lorna McMillan, Group
Company Secretary.
For further information, please contact:
Investors and Analysts
Richard Smith +44 7483 399 303
------------------------------------
Head of Investor Relations richard.smith@virginmoneyukplc.com
------------------------------------
Amil Nathwani +44 7702 100 398
------------------------------------
Senior Manager, Investor Relations amil.nathwani@virginmoneyukplc.com
------------------------------------
Martin Pollard +44 7894 814 195
------------------------------------
Senior Manager, Investor Relations martin.pollard@virginmoneyukplc.com
------------------------------------
Company Secretary
------------------------------------
Lorna McMillan 07834 585 436
------------------------------------
Group Company Secretary lorna.mcmillan@virginmoneyukplc.com
------------------------------------
Media Relations
------------------------------------
Matt Magee +44 7411 299477
------------------------------------
Head of Media Relations matthew.magee@virginmoneyukplc.com
------------------------------------
Simon Hall +44 7855 257 081
------------------------------------
Senior Media Relations Manager simon.hall@virginmoneyukplc.com
------------------------------------
Press Office 0800 066 5998
------------------------------------
press.office@virginmoneyukplc.com
------------------------------------
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