SUPERMARKET giant Tesco has announced it is to set up a new global headquarters for its banking arm in Edinburgh.
In a major boost to the Capital's embattled financial services sector, the supermarket giant is in the final stages of finalising a move into the InterPoint development in the Haymarket area.
Around 200 staff will be based at the central Edinburgh
site initially, although Tesco said that the business is growing rapidly so numbers are expected to rise.
It is currently completing the final legal stages of the deal, which will see it rent the whole of the 46,000 square feet building.
Property experts say an office of that size would usually be expected to hold at least 460 staff or up to around 650 if used as a call centre operation.
Business leaders in the city have welcomed the move, as the Capital is bracing itself for hard times after the troubles at Royal Bank of Scotland and HBOS.
Although not willing to discuss a particular site until a deal is formally completed, a spokeswoman for Tesco Personal Finance told the Evening News: "We are a growing business and we are currently looking into options for a new headquarters in the centre of Edinburgh."
She added that the building will initially be for the 200 Tesco Personal Finance staff currently working from within a Royal Bank of Scotland office at The Gyle, but said its continued expansion is likely to lead to numbers growing.
Tesco has said it is planning to grow profits from its finance arm to over £1 billion over the next few years.
Among products that it is understood to be considering offering for the first time are home mortgages and current accounts.
It is thought to have been attracted to InterPoint partially as it gives them the opportunity to create a large 'Tesco Personal Finance' sign to the rear of the building that will be visible to train commuters moving towards Haymarket Station.
Its commitment to Edinburgh has been welcomed by business leaders. Graham Birse, deputy chief executive of the Edinburgh Chamber of Commerce, said: "The fact that Tesco is making this move shows that the financial services brand in Edinburgh is still alive."
He added that the news will also be a boost to the jobs market. Tesco is in the process of buying RBS's 50 per cent stake in Tesco Personal Finance, with the deal expected to be completed within weeks.
Stewart Taylor, director of the business space consultancy at property firm CB Richard Ellis, said: "It is a significant deal in the market at any time, even ignoring current conditions. It is great news for Edinburgh and good news for the general economy as they will be significantly increasing numbers and they will no doubt target those people who may be losing jobs at RBS and HBOS."
The InterPoint building is currently being marketed by Jones Lang LaSalle and Ryden.
The full article contains 495 words and appears in Edinburgh Evening News newspaper.
