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Lloyds Confirms £2.5bn Bailout Repayment To Brown

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http://business.timesonline.co.uk/tol/busi...icle6457965.ece

Lloyds Banking Group will repay about £2.56 billion to the Government, setting the ball rolling as banks around the world make moves to pay back emergency bailouts made during the credit crisis.

Lloyds confirmed today it would repay the cash after it raised £4.3 billion by selling new shares, becoming the first bank to repay some of the Government’s £37 billion bailout of the UK bank sector. The early repayment will help to justify the billions of pounds of taxpayers’ money pumped into the banks in the past year.

The repayment is being made far sooner than either the City or the Government could have expected, just eight months after the Treasury had to bail out Lloyds following its controversial takeover of HBOS, its struggling rival.

Sir Victor, speaking to Bloomberg said: “We’ve got a major merger that’s beginning to show results.â€

"We’re only about 130 days into it, but it will be fine," he said. "We’ve got the program with the government which will insure us against the very worst of the loans, should there be a further downturn.â€

The Lloyds move came after US banks Morgan Stanley, JPMorgan Chase and American Express said in the last week they would sell shares as they position to repay billions of dollars borrowed under the US Treasury’s Troubled Asset Relief Program.

In a sign of growing confidence, US regulators are expected on Wednesday to name those banks allowed to repay massive bailouts handed out at the height of the financial crisis.

But reflecting the scale of the problems still besetting a battered global banking system, the Swiss government showed no sign of selling out of UBS when a lockup period for converting its notes into shares ends next week.

Indeed, even the money Lloyds will pay back represents less than one sixth of the £17 billion into the bank by the Government and one fourteenth of the total doled out in the bailout of some of Britain’s leading banks unveiled last October.

And while the repayment will loosen the government’s grip on Lloyds in terms of limiting its ability to pay dividends, the state’s stake is still set to rise still further this year.

Shares in Lloyds fell 5.1p or 7.7 per cent, to 61.10p.

So we get £2.5bn back only to cover probably even bigger losses from HBoS.

Anyone like to predict what losses HBoS will end up passing onto the govt.

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OH NOES!!!1111!!1!

THE BAILOUTS ARE BEING REPAID? :blink:

IT'S A LIE, IT'S A CON, IT'S A LIAR LOAN B*****ER SCUM TRICK.

IGNORE "THE RECOVEREH" AND IT MIGHT GO AWAY. :(

[/ericpebble-spunkonmattress-blooloo rant]

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OH NOES!!!1111!!1!

THE BAILOUTS ARE BEING REPAID? :blink:

IT'S A LIE, IT'S A CON, IT'S A LIAR LOAN B*****ER SCUM TRICK.

IGNORE "THE RECOVEREH" AND IT MIGHT GO AWAY. :(

[/ericpebble-spunkonmattress-blooloo rant]

:) Just because they have started to repay the debt doesn't mean they're out of the wood yet! If that was the case I would fell far more confident that I'll see a good return on the 2K I have invested with them!

does it not state in the article:

And while the repayment will loosen the government’s grip on Lloyds in terms of limiting its ability to pay dividends, the state’s stake is still set to rise still further this year.

If this is true that, the more they pay off, the lesser the grip. Its quite understandable that they're making an effort to get free. As soon as the start paying dividends they will receive a lot of much needed investment from other sources.

Look at the freedom Barclays has not being whipped by the government.

Edited by Hawk

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