All change at Abbey

Out with the old...

There's a new banking name on the High Street today.

Well, it's not a new name exactly - Abbey National has decided to drop half its name.

In future it will be known simply as Abbey.

...in with the new

It's part of a major rebranding for the UK's sixth biggest bank, costing £11m.

As well as the name change, the logo of a couple walking under an umbrella will disappear, branch interiors will be painted magenta and there will be a new slogan - "Turning banking on its head".

"Interestingly, they've kept some of their heritage and their past which is quite valuable because a lot of people still think they're a building society, and that has got some very good brand connotations," says Phil Middleton, head of retail banking at Ernst & Young.

Easier for customers

Services and products will also change. The six existing current accounts will be replaced by just one - called The Account.

As a retail bank they had become a bit tired, a bit bureaucratic, a bit complicated. Phil Middleton, Banking analyst

Savings accounts and mortgages will also be available in only three types, to make it easier for customers to find the right one.

"We still have a long way to go and we won't change everything overnight but we are sending a clear signal to our customers that we intend to be truly different," says Abbey director Angus Porter.

So what's behind the changes?

Core business

Since the Abbey Road and National building societies merged in 1944, the business had grown to become the country's second largest mortgage lender.

How the new branches will look

But in recent years it has strayed from its core business into corporate banking and bond investments.

Its portfolio also included a host of widely varying businesses, such as a train leasing company, a share of Sydney airport and a car credit business.

This year it reported its first loss since going public in 1989.

It was £984m in the red, compared with a profit of £1.47bn in 2001.

Earlier this year, new chief executive Luqman Arnold announced a major overhaul designed to revive the bank's flagging fortunes.

Luqman Arnold: Overseeing major revamp

Investors welcomed the move, and Abbey's shares jumped by nearly 10%.

The rebranding is just part of a three-year strategy which includes selling assets which don't support the company's retail business.

But the revamp could have a downside. Some analysts believe a sleeker, more organised Abbey could be vulnerable to a takeover bid.

The bank says it wants to focus more on how it treats its customers.

Recruitment

It will recruit another 450 staff in branches with an extra 150 call centre workers being hired to deal directly with customers.

"We want to turn banking on its head. We've got a long way to go before we've fully achieved that, but when we do, the new Abbey will be part of the real world, the customer's world, not the baffling world of banking," says Mr Arnold.

Phil Middleton says that although many of the bank's problems are behind it, it was in need of a shot in the arm.

"As a retail bank they had become a bit tired, a bit bureaucratic, a bit complicated, doing things as much for themselves as for the customers.

"The new management team is saying this is about freshness and about being accessible to customers.

"This is not just skin deep - what Abbey is doing is trying to change the way customers experience the brand and shop for financial services."