Superbrands case studies: Abbey National

Originally published in 'Consumer Superbrands Volume V', March 2003. The book reviews the UK's strongest consumer brands as judged by an independent judging panel.

Case study provided by Superbrands.


The retail financial services market has changed rapidly over recent years. The UK financial services sector was at one time characterised by a combination of regulatory restrictions and functional demarcation.

In the past two decades successive governments have continued to deregulate the industry, largely in response to past recessions and to support structural change by improving the efficiency and competitiveness in both the public and private sectors.

In addition to this, technological advances have fuelled competition in almost every sector of the financial services market. Furthermore, banks and building societies have been joined in the UK retail banking and financial services marketplace by a diverse range of new entrants such as internet banks, supermarkets, insurance companies, credit card providers and consumer finance groups.

Abbey National and its subsidiaries constitute a major financial services group in the UK. With total assets of £215 billion and income before taxes of £1,938 million as at December 31st 2001, the Abbey National Group is ranked as the 6th largest banking group in the UK in terms of total assets. It is the UKs second largest residential mortgage lender and retail deposit taker. Furthermore, Abbey National has a relationship with one in three UK households.


In 1989 Abbey National became the first building society to convert to banking status with the intention of becoming the outstanding financial services provider in the UK.

Since it was founded in 1944, Abbey National has enabled thousands of people in the UK to own their own homes and save for the future. One of Abbey Nationals chief achievements has been to combine the best of its building society heritage with its banking status.

Terry Burns, chairman of Abbey National, says: "Abbey National is focused on providing its customers with a quality range of retail financial services, from traditional mortgage and savings businesses to personal and small business banking, and consumer credit, investment, protection and insurance."

Since conversion in 1989, the Abbey National Group has acquired major operations in life assurance, personal finance and point of sale finance businesses, among others.

The Abbey National Group also has an overseas presence predominantly serving the offshore market.

Abbey National has been at the forefront of introducing new technology to enhance its customer propositions. For example, Abbey Nationals retail customers were the first in the world to be able to access their accounts via the internet and through digital television. Abbey Nationals e-banking service is at the heart of the Groups bricks & clicks strategy, designed to give customers choice about how they deal with the bank, whether over the telephone, at a cash machine, in a branch, through digital TV or over the internet.

The Abbey National Groups separately branded internet bank, Cahoot, went live in 2000, offering a competitively priced credit card and current account. Cahoot has since successfully launched flexible loan, travel insurance and savings and investments accounts.

Abbey National was awarded Best Overall Lender 2001-2002 by Your Mortgage magazine and Best Bank in 1999-2000 and 2000-2001.


Abbey National was formed in 1944 following a merger between the London-based Abbey Road Building Society, founded in 1874, and the National Building Society, established in 1849. There was large-scale public demand for housing in post-war Britain, which Abbey National helped to meet with the provision of mortgages.

At first, Abbey National focused on savings accounts and mortgages, but during the 1960s and 1970s a wider range of financial services was gradually introduced. By 1989, Abbey National was officially recognised as a bank by the Bank of England and had 681 branches nationwide -- a huge leap from 1960 when the building society had just 60 branches. Unlike other banks that were actively cutting the number of branches at the time, Abbey National continued to increase its number of outlets and in 2002 the bank had over 750 branches.

Abbey Nationals transition to plc status in 1989 was strongly supported by its members. Up to five million voted their approval in a secret ballot. Almost overnight, the total number of private shareholders in the UK rose from six million to nine and a half million. Today, the Abbey National Group has just over two million shareholders, of whom a large number have held shares since 1989. Abbey Nationals change to bank status also resulted in the formation of its wholesale banking arm, Abbey National Treasury Services plc.


Abbey Nationals retail bank offers a whole range of financial services, such as banking services, market leading in-credit and overdraft rates, a variety of loans to reflect varying needs, mortgages, insurance and financial planning. Indeed, Abbey National now has a level of service in place to act as a one-stop-shop, for all its customers. Their financial needs are met through its network of branches, telephone services, cash machines and e-banking facilities.

Mortgages have always been the backbone of Abbey Nationals business. It is the second largest mortgage lender in the UK, assisting more than two million people to buy their homes. It offers an extensive range of different mortgages including fixed, capped and now Flexible Mortgages, which enable customers to stop, start and vary their payments. Advice on mortgages is available face to face in the branch or over the phone from Abbey Nationals financial planning advisors on hand to guide customers through a lifetime of financial needs.

Abbey National acquired Scottish Mutual in 1992. As well as selling pensions and investment products through intermediaries, Scottish Mutual also provides protection products under the Scottish Provident brand name.

Abbey National also offers a full range of banking services, including a bank account, credit card, savings accounts and a variety of loans to reflect different needs. Abbey Nationals user friendly bank account offers market leading in-credit and overdraft rates.

Other features include a 24-hour telephone banking service. AbbeyLink automated teller machines (ATMs) linked to over 28,000 cash machines and account access via the internet and digital TV.

Abbey National continues to add to its range of saving and investment accounts for people with anything from £1 to £2 million to invest. These accounts range from instant access through to a range of fixed rate bonds to ISAs and other stock market-linked products.


Abbey National has developed its convenience retailing strategy introducing innovative partnerships with third parties such as Costa Coffee and Homebase. It is offering customers a choice of convenient time saving touchpoints at alternative venues other than the traditional bank environment to satisfy their financial needs. It is also the first UK bank to implement franchising, with over half the branch network now operating in this way. This allows the local market to be more responsive to their individual market conditions. Credit card provision has been outsourced to MBNA and has accelerated the introduction of highly competitive cards.

In addition, the banks e-commerce offering has been overhauled and now provides e-mortgage and e-credit card management facilities.

In 2002, Abbey National became the first UK high street bank to offer a fund supermarket with the launch of FundsCentre, offering a choice of 280 funds from 24 leading fund managers.

FundsCentre is a gateway to the UKs leading fund providers, offering easy access, choice and convenience. It is available to investors online, by telephone and by post.

In September 2002 Abbey National for Intermediaries was created to bring the intermediary brands of Scottish Mutual, Scottish Provident, James Hay and Cater Allen Private Bank under one umbrella. By January 2003, intermediaries were able to access all of Abbey Nationals UK intermediary products, services and brands through a single point of contact.


Abbey National Retail Bank repositioned its brand in December 1997 following extensive consumer and staff research. The vision statement was to make its customers lives easier by delivering products and services in a straightforward, unstuffy, astute, friendly and can-do manner that suits individual needs. These sentiments are reflected in the strapline "because life's complicated enough".

A campaign featuring Alan Davies was used to communicate this positioning until 2001. The work used Davies to personify customers, showing the potential confusion money matters could cause and illustrated how Abbey National could make managing ones finances more straightforward.

In 2002, the communications strategy was refreshed -- while keeping the idea of making customers lives easier at its core, the new work reinvigorates the creative look and feel of the brand.

The Abbey National Group supports charitable organisations and equal opportunities for disabled members of the community. Abbey National also supports education, training and employment for disadvantaged groups in society. Furthermore, the Abbey National Group made a community contribution of £3.9 million in 2001.


Abbey National retail banks positioning in the financial services market is typified by its mission statement which reflects the companys desire to blend the old with the new. Its intention is to achieve above average growth in shareholder value over the long term, which can be achieved only if it meets the needs of its customers, its staff, and all the other stakeholders in the business.

This approach, combined with listening to and understanding its customers and staff is what "because life's complicated enough" is all about.


  • About one in seven mortgages in Britain is provided by Abbey National, making it the second largest mortgage lender in the UK.

  • Branch staff carry out around 98 million transactions for customers every year.

  • In November 1984, Abbey National became the first building society to offer a £100 cheque guarantee card.

  • In 1989, Abbey National became the first UK company to sell mortgages over the telephone.

  • During the 1989 ballot to decide Abbey Nationals conversion to plc status, there were three flights a day to Germany to pick up ballot boxes billeted at the British army bases.

    © 2003 Superbrands Ltd