Tesco bank pulls the plug on its mortgages

Tesco Bank has raised the sale sign on its mortgage portfolio and is to halt new lending, in a move that is likely to impact some 23,000 customers.

The bank, which has key operations in Edinburgh and Glasgow, said it was actively exploring options to sell its existing portfolio, which has total lending balances of £3.7 billion.

Gerry Mallon, the chief executive of Tesco Bank, said: “In recent years, challenging market conditions have limited profitable growth opportunities. Our focus is on how we best serve Tesco customers and align our resources effectively to their needs while ensuring that our offer remains sustainable in the long term.

“To that end, we have made the strategic decision to focus on serving a broader range of customers in more specific areas, which means moving away from our mortgage offer.”

The bank warned there was no certainty of a transaction.

The current Tesco bank mortgage customers may find themselves mortgage prisoners for some while and this is likely to affect their finances and general wellbeing.

If you need financial advice and you live in the UK then you could contact the Money Advice service over the phone or via chat for impartial advice.

You can also contact the debt charity “Step Change” if you are in debt and need help.