Virgin Banking

The Virgin Group is the last private bidder standing in search of a path forward for Northern Rock, the troubled British mortgage bank. With multiple enterprises including its iconic airline, The Virgin Group could bring a refreshing and even irreverent approach to English consumer banking, which is admittedly not much of a stretch. Northern Rock focuses on mortgage lending, secured small commercial lending, and consumer finance. With roughly the equivalent of $200 billion in assets Northern Rock at the moment is, for all practical purposes, being run by the U.K. government as a result of their role as guarantor. Virgin proposes investing $1 billion and raising another $1 billion in a share issue to take over the bank.

There is no certainty whatsoever that their bid will be accepted. If by any chance it succeeds, it could be a treat to watch. With their Chairman combining the swagger of a rock star and the risk taking of 007, and having a track record of aggressively spending to introduce new ideas to old industry models, who knows. Staid signage, reassuringly conservative decor, obtusely worded forms to sign, understated advertising, banker's hours, oligopolistic product offerings, I think not. And if he's successful, has Virgin ever stopped at the U.K. border. It's not the way Branson thinks. What franchise in the U.S. fits their product line, has made efforts to break the traditional model, but has never had enough of the financial and intellectual capital to get their big ideas over the top. It's those ever optimistic strivers the Wamulians. Just think about it. Northern Rock and Washington Mutual becoming the foundation of a new global consumer banking power, Virgin Banking. Virgin is unequivocally a global brand. Why not financial services. Who says the world must cede global consumer banking dominance to Citi and HSBC.

VIRGIN BANKING----THE SHAPE OF THINGS TO COME

I may be getting a bit ahead of myself.