Egg was an
internet bank A direct bank (sometimes called a branch-less bank or virtual bank) is a bank that offers its services only via the Internet, email, and other electronic means, often including telephone, online chat, and mobile check deposit. A direct bank has no ...
headquartered in
Derby
Derby ( ) is a city and unitary authority area in Derbyshire, England. It lies on the banks of the River Derwent in the south of Derbyshire, which is in the East Midlands Region. It was traditionally the county town of Derbyshire. Derby gai ...
, that is now a trading name of
Yorkshire Building Society
Yorkshire Building Society is the third largest building society in the UK, with its headquarters in Bradford, West Yorkshire, England. It is a member of the Building Societies Association.
The society also owns the Chelsea Building Society a ...
. Egg was born out of the banking arm in the United Kingdom of
Prudential plc
Prudential plc is a British Multinational corporation, multinational insurance company headquartered in London, England. It was founded in London in May 1848 to provide loans to professional and working people.
Prudential has dual primary list ...
, which was established in 1996, and the Egg brand was launched in October 1998. The first online credit card was launched in September 1999.
It was only possible to operate an Egg account over the internet, or via their call centre. Egg specialised in
savings
Wealth is the abundance of valuable financial assets or physical possessions which can be converted into a form that can be used for transactions. This includes the core meaning as held in the originating Old English word , which is from an I ...
and
general insurance, together with
loan
In finance, a loan is the lending of money by one or more individuals, organizations, or other entities to other individuals, organizations, etc. The recipient (i.e., the borrower) incurs a debt and is usually liable to pay interest on that d ...
s,
credit card
A credit card is a payment card issued to users (cardholders) to enable the cardholder to pay a merchant for goods and services based on the cardholder's accrued debt (i.e., promise to the card issuer to pay them for the amounts plus the o ...
s and
mortgage
A mortgage loan or simply mortgage (), in civil law jurisdicions known also as a hypothec loan, is a loan used either by purchasers of real property to raise funds to buy real estate, or by existing property owners to raise funds for any pu ...
products. The business was sold in January 2007 to Citigroup.
In March 2011, the credit card accounts were bought by
Barclaycard, and in July 2011, the remaining savings and mortgage businesses were sold to
Yorkshire Building Society
Yorkshire Building Society is the third largest building society in the UK, with its headquarters in Bradford, West Yorkshire, England. It is a member of the Building Societies Association.
The society also owns the Chelsea Building Society a ...
, which subsequently transferred all remaining customer accounts over from Egg.
Following the sale of its assets, Egg Banking plc, which remained under the ownership of Citigroup, was renamed Canada Square Operations Limited and continues to handle matters relating to certain Egg products from before the sale of assets and any assets that were not transferred to the new owners.
History
Egg was established as a division of life assurance company
Prudential. Prudential Banking was involved in direct selling of savings and mortgage products.
On 11 October 1998, the division was renamed Egg, and relaunched as the United Kingdom's first
Internet bank A direct bank (sometimes called a branch-less bank or virtual bank) is a bank that offers its services only via the Internet, email, and other electronic means, often including telephone, online chat, and mobile check deposit. A direct bank has no ...
. The bank offered 8% savings interest and the first credit card in the United Kingdom, which offered a 0% interest rate on both new purchases and balance transfers, with also an annual anniversary offer, and as a result soon had more than two million customers enjoying these market leading rates.
In June 2000, Prudential cashed in on its stake, and floated 21% of the company on the
London Stock Exchange
London Stock Exchange (LSE) is a stock exchange in the City of London, England, United Kingdom. , the total market value of all companies trading on LSE was £3.9 trillion. Its current premises are situated in Paternoster Square close to St Pau ...
, retaining 79%. In January 2004, Prudential announced its intention to sell its remaining stake in Egg to a third party. Paul Gratton was chief executive of Egg in 2001.
Despite rumours of interest from the likes of
Royal Bank of Scotland
The Royal Bank of Scotland plc (RBS; gd, Banca Rìoghail na h-Alba) is a major retail and commercial bank in Scotland. It is one of the retail banking subsidiaries of NatWest Group, together with NatWest (in England and Wales) and Ulster Bank ...
and
HSBC
HSBC Holdings plc is a British multinational universal bank and financial services holding company. It is the largest bank in Europe by total assets ahead of BNP Paribas, with US$2.953 trillion as of December 2021. In 2021, HSBC had $10.8 tri ...
, no formal offers were made public, and Prudential dropped its plans in August 2004.
Subsequently, Prudential bought back the remaining minority share in January 2006, and delisted the organisation from the
London Stock Exchange
London Stock Exchange (LSE) is a stock exchange in the City of London, England, United Kingdom. , the total market value of all companies trading on LSE was £3.9 trillion. Its current premises are situated in Paternoster Square close to St Pau ...
. Chief executive officer Paul Gratton left the organisation in March 2006, to be replaced by then chief operating officer Mark Nancarrow. Nancarrow was subsequently replaced by Ian Kerr, formerly of
HBOS
HBOS plc was a banking and insurance company in the United Kingdom, a wholly owned subsidiary of the Lloyds Banking Group, having been taken over in January 2009. It was the holding company for Bank of Scotland plc, which operated the Bank ...
, in November 2006.
On 29 January 2007, Prudential announced that it had agreed to sell Egg to
Citigroup
Citigroup Inc. or Citi (Style (visual arts), stylized as citi) is an American multinational investment banking, investment bank and financial services corporation headquartered in New York City. The company was formed by the merger of banking ...
for a consideration of £575 million subject to approval by the
Financial Services Authority
The Financial Services Authority (FSA) was a quasi-judicial body accountable for the financial regulation, regulation of the financial services industry in the United Kingdom between 2001 and 2013. It was founded as the Securities and Investmen ...
.
On 1 May 2007, the sale of Egg to Citi was completed, and Egg CEO Ian Kerr was appointed head of Egg and Citi UK Consumer.
At the beginning of 2008, Kerr left the business and was replaced in March by Bert Pijls. Pijls joined Citi in 1990, and has held several roles in the bank. In November 2007, approximately 350 non specialist roles were moved from the
Dudley centre to
Derby
Derby ( ) is a city and unitary authority area in Derbyshire, England. It lies on the banks of the River Derwent in the south of Derbyshire, which is in the East Midlands Region. It was traditionally the county town of Derbyshire. Derby gai ...
, resulting in redundancies and relocation packages. The Dudley office was later closed.
On 1 March 2011,
Barclays Bank
Barclays () is a British multinational universal bank, headquartered in London, England. Barclays operates as two divisions, Barclays UK and Barclays International, supported by a service company, Barclays Execution Services.
Barclays traces ...
announced that they had agreed to buy Egg's more than one million credit card accounts from Citigroup. Barclay's
Barclaycard division took over the Egg credit card business in May 2011, after Citi had spent time trying to sell the business as part of its Citi holdings portfolio.
Citi and Barclaycard shared the same site at Pride Park, Derby, but it was announced on 21 June 2011 that Barclaycard would move operations to their Kirkby and Northampton sites, leaving 659 people redundant. On 25 July 2011, Egg announced the proposed sale of all savings and mortgage accounts to
Yorkshire Building Society
Yorkshire Building Society is the third largest building society in the UK, with its headquarters in Bradford, West Yorkshire, England. It is a member of the Building Societies Association.
The society also owns the Chelsea Building Society a ...
. This would complete Citigroup's sale of the Egg business.
Advertising
Egg used several advertising agencies to produce its advertising. These included CHI & Partners, Lowe Plus and
Mother
]
A mother is the female parent of a child. A woman may be considered a mother by virtue of having given childbirth, birth, by raising a child who may or may not be her biological offspring, or by supplying her ovum for fertilisation in the cas ...
. Egg Card was launched in the United Kingdom with a television campaign by CHI and press advertisements and direct marketing created by Lowe Plus. Among the press advertisements was one showing a sea of urine samples with a headline that read 'We're just taking 10.9% APR. What's your card taking?'
Egg France
Capitalising on its British success, Egg launched in France in November 2002 with La Carte Egg. Despite investing heavily in the market in France, the services were never popular with the French, who generally hold fewer credit cards than the British. In October 2004, Egg decided to close its French operations, selling the unsecured lending business to
:fr:Banque Accord, and the savings and brokerage businesses to
ING
Ing, ING or ing may refer to:
Art and media
* '' ...ing'', a 2003 Korean film
* i.n.g, a Taiwanese girl group
* The Ing, a race of dark creatures in the 2004 video game '' Metroid Prime 2: Echoes''
* "Ing", the first song on The Roches' 1992 ...
of the Netherlands.
Controversies
On 2 February 2008, Egg chose to cancel the credit cards of 161,000 (7%) of its customers. The bank gave customers 35 days' notice, after which they would not be able to spend more on their cards. While publicised as an attempt to purge "risky" customers from their books, many affected customers came forward with claims that they had excellent credit histories.
This led to speculation that the move was an attempt to remove customers who did not accumulate interest on their accounts and therefore did not generate profit for the bank.
The
Financial Services Authority
The Financial Services Authority (FSA) was a quasi-judicial body accountable for the financial regulation, regulation of the financial services industry in the United Kingdom between 2001 and 2013. It was founded as the Securities and Investmen ...
fined Egg £721,000 in December 2008 for the persistent misselling of
payment protection insurance
Payment protection insurance (PPI), also known as credit insurance, credit protection insurance, or loan repayment insurance, is an insurance product that enables consumers to ensure repayment of credit if the borrower dies, becomes ill or disabl ...
(PPI) on its credit cards. The authority's director of enforcement, Margaret Cole, said "Egg used inappropriate sales techniques to try to persuade customers to buy payment protection insurance on their credit card, even when they asserted they did not want the cover."
During 2008, Egg attempted to have one of its customers imprisoned, saying the
Chip and PIN Chromatin immunoprecipitation (ChIP) is a type of immunoprecipitation experimental technique used to investigate the interaction between proteins and DNA in the cell. It aims to determine whether specific proteins are associated with specific geno ...
cards were 'uncloneable', and the customer was 'clearly lying' about transactions from an ATM. The police arrested the customer, but after much investigation, the customer was acquitted.
References
External links
*
{{Commercial and retail banks in the United Kingdom
Defunct banks of the United Kingdom
Citigroup
Prudential plc
1998 establishments in England
2011 disestablishments in England
Banks established in 1998
Banks disestablished in 2011
2011 mergers and acquisitions