Liverpool-based Alliance & Leicester has taken a huge step towards securing its long-term future after shareholders approved a takeover by Spain's Banco Santander.
The decision will be seen as good news on Merseyside, where A&L employs more than 1,500 people, the bulk of whom work in its commercial division at the former Girobank headquarters in Bootle.
A&L's acting chairman, Roy Brown, told shareholders attending an extraordinary general meeting in Birmingham that the £1.3bn takeover by Santander was in their best interests, given the current market turmoil.
Dismissing calls from some shareholders for A&L to “ride out” the global financial storm, Mr Brown predicted that the banking sector would get worse before it gets better.
Mr Brown told the EGM that adverse market sentiment could be indiscriminate, particularly against banks, and the current “vast” financial crisis was unprecedented in the last century.
“There is a regime out there of fear, volatility, contagion – and all of that might increase,” he told around 100 A&L shareholders gathered at Birmingham’s International Convention Centre.
Mr Brown stressed that the Santander takeover – which won the backing of more than 96 per cent of shareholders – coincided with a time of extreme economic turbulence.
Referring to the collapse of Lehman Brothers and other market developments during the past year, Mr Brown added: “That turbulence has got worse over the weekend and will probably get even worse.”
The takeover of A&L has still be approved by the Financial Services Authority and the Bank of Spain, but is now expected to be completed in mid-October.
The branding of A&L following the takeover by Santander, which already owns high street lender Abbey, has yet to be determined.
A&L currently has a network of 250 branches and employs 2,000 people in Leicester and 1,500 at a site in Bootle.
A&L's board agreed the sale to Santander in July – just two weeks before the British bank announced that the credit crunch had almost completely wiped out profits in the first six months of the year – at £2m, down from £290m a year ago.
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