Tesco Bank has completed the sale of its banking operations to Barclays, starting a 10-year partnership between the two banks.

The partnership will provide Barclays customers with access to Tesco-branded banking products and services.

It will also create the opportunity to develop new products with Barclays under the Tesco Bank brand.

Tesco will retain all of the existing insurance and money services activities, including ATMs, travel money and gifts cards.

As part of the deal, Tesco said that it intends to return £700m to shareholders via an incremental share buyback.

This is expected to commence following completion of the final tranche of the £1bn buyback programme, which is currently underway.

Group chief executive officer (CEO) at Tesco, Ken Murphy, said: "We are delighted to be working alongside Barclays to unlock even greater value for Tesco Bank customers. Through our strategic partnership, customers will have access to new and innovative propositions, while continuing to enjoy the unique benefits of Tesco Clubcard.

"This is a significant moment for all our colleagues at Tesco Bank and I want to say a heartfelt thank you for all their hard work, helping millions of loyal customers to manage their money for more than 25 years. Their dedication is relentless and I know that this new partnership with Barclays will only build on their success."

Group CEO at Barclays, C.S. Venkatakrishnan, added: "This acquisition is an important step in increasing our investment in the UK. We look forward to collaborating with Tesco Group on delivering Tesco-branded financial services. We are delighted to welcome all transferring Tesco Bank employees and customers to Barclays."

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