TESCo Bank boss Benny Higgins has been a patient man, though it has probably proved to be a virtue in the light of the flak surrounding his peers.
Sceptics expected the banking project to come unstuck, but the supermarket giant persisted with it in the hope of carving out a niche in what was, at the time of its launch in 1997, a robust and impenetrable sector.
In its first nine years it remained a modest operation, tacked under the wing of Royal Bank of Scotland (RBS), and badging various products to sell to customers who were otherwise preoccupied with buying their groceries.
Since breaking away from RBS in 2008, the bank’s growth has accelerated and the range of products widened to around 30. There have been some delays along the way, some self-inflicted as the board awaited the right conditions to unleash the next offering.
Crucially, the launch next year of a current account will be its biggest step since last year’s move into mortgages.
The creation of hundreds of jobs in Scotland speaks almost for itself as an expression of Tesco’s commitment and also helps offset those that have been lost at other financial institutions.
By offering a full service retail banking service, Tesco Bank will legitimately claim to have moved from niche to mainstream, even if its share of the overall market remains tiny.
In the light of the scandals and misfortunes that have hit the banking sector, there were those who wondered if the group board would continue to support its expansion into financial services. Some questioned whether shareholders would tolerate the more onerous demands of regulators for it to have so much capital tied up in this division to support a growing loan book.
But Tesco and Sainsbury’s have shown a desire to push on with the move into banking and set the pace among so-called “challenger” banks.
If anything, they have been encouraged by the tarnished reputation of their older rivals which has opened up opportunities to offer a fresh alternative.
Share sale that frees STV from ITV threat
AS THE consolidation of the ITV network gathered pace in the late 1990s, it looked as though SMG, as STV was then known, would be among those to be scooped up.
Yet the number crunchers and analysts could never quite agree on the logic of a tie-up. By the middle of the last decade ITV had control of practically the entire channel three network, but acquiring Scottish lost its appeal.
There were better opportunities elsewhere and, as SMG hit troubles of its own. it looked less and less attractive. Better use of ITV’s capital could be found in expanding its reach into the new digital channels.
Yesterday’s sale of its last remaining shares ends any prospect of STV falling into ITV’s hands, a move that has political as well commercial ramifications ahead of a year when Scottish broadcasting will inevitably come under the spotlight.
On a purely commercial level, the two companies now co-exist after years of squabbling over naming rights and network agreements.
A new era of co-operation should bode well for both, and STV has shown itself capable of surviving against the odds and able to develop opportunities to provide productions to a range of buyers that includes the BBC.