Virgin Money profits fell before Nationwide Building Society takeover

Profits at Virgin Money fell in the year before more than six million of its customers were absorbed into the Nationwide Building Society, the bank’s final set of accounts show.

It follows the mutual’s £2.8 billion takeover of Virgin Money in 2024, which created the UK’s second largest savings and loans group after Lloyds.

Nationwide, which has 16 million members, and Virgin Money are still separate brands, but since April they are part of the same financial powerhouse.

The transfer of customers means Virgin Money’s performance will no longer be visible as its future results will be folded into Nationwide’s accounts.

Last night James Sherwin-Smith, who is standing as a member-nominated candidate for election to Nationwide’s board next month, demanded more transparency from the society.

He said: ‘Members deserve clear, ongoing disclosure about whether the deal is delivering the benefits that were promised and is proving a good return on investment.

‘As Virgin Money is integrated into Nationwide, there will be less standalone reporting on the performance of the acquired business. Integration shouldn’t mean reduced transparency,’ he added.

Virgin Money made a profit after tax of £113 million in the year to this March, down from £230 million posted in the 18 months to March 2025.

The results also confirmed that during the year an extra £285 million was pumped into Virgin Money’s Clydesdale Bank unit to bolster the Scottish lender’s financial position. It takes the amount injected into Clydesdale since the Nationwide takeover to more than £1 billion, as previously reported in the Financial Mail on Sunday.

Nationwide booked a £2.3 billion gain on the deal because the assets that it bought were valued at more than the purchase price.

It also paid eligible members £50 each – a total of £600 million – as a ‘thank you’, even though it did not give them a say on the deal.

It recently paid a further £100 ‘fairer share’ bonus to eligible members, but Virgin Money customers won’t qualify for a similar payout until next year.

The building society’s chief executive Debbie Crosbie – a former senior director at Clydesdale – has hailed the Virgin Money deal as a ‘unique opportunity’ that would ‘strengthen us financially’.

She has promised a gradual approach to integrating Virgin Money, but has yet to say how much it will cost to merge Virgin Money’s IT systems and improve its customer service.

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Crosbie also faces questions at next month’s online-only annual meeting over her pay, which nearly doubled to £4.7 million last year.

She and the board oppose Sherwin-Smith’s bid to join, saying he lacks relevant experience.

Sherwin-Smith, who has a 20-year record in financial services, has hit back, urging members not to use a ‘quick vote’ polling system that he says is biased in the board’s favour.

Most of the money pumped in to Clydesdale was used to bring its accounts in line with the more conservative approach of Nationwide.

The rest covered a £250 million payment that tycoon Richard Branson is set to receive for the continued use of his Virgin brand name over the next four years.

A Nationwide source said the Virgin Money results did not reflect the performance of its trading business, Clydesdale Bank.