Jump to content
House Price Crash Forum
Sign in to follow this  
Injin

Lloyds Braced For £13bn Writeoff

Recommended Posts

http://business.timesonline.co.uk/tol/busi...icle6689535.ece

LLOYDS BANKING GROUP is poised to write off as much as £13 billion on its loans to commercial property, businesses and mortgage holders as the crisis engulfing the taxpayer-backed bank deepens.

First-half results due to be posted in three weeks will show that its losses are accelerating, in spite of recent suggestions that the worst of the recession is over.

UBS analysts expect Lloyds to announce a bottom line half-year loss of £6.3 billion as a result of the soaring provisions.

The writeoffs for the first six months of the year would match the losses recorded by Lloyds TSB and HBOS in 2008, as they consummated their disastrous merger. The expected bad debt charge is almost twice what Lloyds paid for HBOS when they came together under the government’s watch last autumn. Total writeoffs for this year at Lloyds could exceed £20 billion.

The bad debts come as the bank struggles to find a new chairman to replace Sir Victor Blank, who has agreed to stand down following pressure from UKFI, the government’s shareholder body, which owns 43% of the bank’s shares.

A number of the City’s biggest fund managers have warned Lloyds not to press ahead with the appointment of Sir Win Bischoff to the role.

Although Bischoff had been widely tipped to get the job, a wave of resistance has emerged. Investors believe he is tainted by his former role as chairman of Citigroup, which has received a series of bailouts from American taxpayers.

Bischoff is also close to Eric Daniels, the chief executive of Lloyds and a former colleague at Citigroup. Many of Lloyds’ biggest shareholders are keen for the new chairman to find a replacement for Daniels over time — a job they fear Bischoff may not have the stomach for.

City grandee Chris Gibson-Smith has also been linked to the job, although investors have queried how he would be able to dedicate the time needed for it, given his existing position as chairman of both the London Stock Exchange and British Land.

Lloyds is also fighting off a full-frontal assault from Brussels, over claims it may have benefited too much from state aid.

Neelie Kroes, the European Union’s competition commissioner, warned two weeks ago that she was examining both Lloyds and Royal Bank of Scotland, and she threatened to break them up. Analysts say that when the huge provisions are put to one side, Lloyds is now highly profitable and has a dominant market share in the UK. Daniels is confident that, in the long term, investors will enjoy enormous benefits from the marriage of the two banks.

Alistair Darling, the chancellor, and Tom Scholar, his most senior civil servant, have made a number of submissions to Kroes in recent days pressing the case for the banks to remain intact.

The Treasury argues that the UK’s bail-out programmes have been much tougher on banks than similar deals around Europe. According to banking sources, however, EU officials are concerned that Lloyds and Royal Bank of Scotland are gaining too big a share of certain markets.

Ironically, their rising market shares are partly due to government pressure to pump more lending into the real economy. John Kingman, the chief executive of UKFI, will reveal his strategic plan on Monday. He is expected to say that the taxpayer banks should be allowed to lend profitably, irrespective of government pressure.

.............................

Beyond farce.

Share this post


Link to post
Share on other sites
Guest KingCharles1st

I wonder if the X billion bankers profits come out of this, or are sort of "tagged on the end..." :unsure:

Share this post


Link to post
Share on other sites

The thing they dare not say is that they lent a SHED full of cash overseas, which they are NOT going to get back. Factor in the ON GOING US collaspe & well............Frankly we f*cked!

Mike

Share this post


Link to post
Share on other sites

They must have been doing really well to be able to write off £13bn and still be a going concern. That's more than £200 for every man woman and child in the UK, they must have been saving up for generations. The reason it makes no material difference to the bank (still champagne for breakfast in the square mile) is that banking institutions are already bankrupt the moment they lend money they do not have. It is only a question of the degree of bankruptcy, indeed the the strength of a bank is very often measured by the extent of the bankruptcy with dead loans in fact treated as assets.

Share this post


Link to post
Share on other sites

http://www.dailymail.co.uk/news/article-11...loyds-deal.html

Shareholders turn their fire on PM over 'disastrous' Lloyds deal

By Mail On Sunday Reporter

Last updated at 11:05 PM on 11th July 2009

* Comments (0)

* Add to My Stories

GORDON BROWN was last night dragged personally into the row over Lloyds TSB's disastrous takeover of HBOS.

Furious Lloyds shareholders have demanded transcripts of secret negotiations between Mr Brown and the bank's chairman Sir Victor Blank last July and September.

Share this post


Link to post
Share on other sites

Always suspected it'd be commercial property not residential mortgages that'd pull it all down. Still more to come I reckon.

Share this post


Link to post
Share on other sites
http://www.dailymail.co.uk/news/article-11...loyds-deal.html

Shareholders turn their fire on PM over 'disastrous' Lloyds deal

By Mail On Sunday Reporter

Last updated at 11:05 PM on 11th July 2009

* Comments (0)

* Add to My Stories

GORDON BROWN was last night dragged personally into the row over Lloyds TSB's disastrous takeover of HBOS.

Furious Lloyds shareholders have demanded transcripts of secret negotiations between Mr Brown and the bank's chairman Sir Victor Blank last July and September.

It just gets worse by the day now. The economy is getting worse, Afghanistan is getting worse and Gordo will probably be blamed if swine flu overwhelms us in the winter.

Labour supporters will be as rare as rocking horse shit before the years out.

Share this post


Link to post
Share on other sites
Always suspected it'd be commercial property not residential mortgages that'd pull it all down. Still more to come I reckon.

No sentiment (But my house is WORTH IT! eusa_boohoo.gif ) in CRE.

Share this post


Link to post
Share on other sites

Revolution or facism (in full force) can't be far off now. The government either need to oppress us even more to pay for all this or there needs to be a revolt.

Quick poll, would people prefer 90% tax or a revolution? For those people who are business owners with a relatively comfortable life bear in mind if your customers can't afford your products you will be going down with them.

Problem is things could be even worse after a revolution considering the average intelligence of people here and the utter selfishness of our culture.

Share this post


Link to post
Share on other sites

Create an account or sign in to comment

You need to be a member in order to leave a comment

Create an account

Sign up for a new account in our community. It's easy!

Register a new account

Sign in

Already have an account? Sign in here.

Sign In Now
Sign in to follow this  

  • Recently Browsing   0 members

    No registered users viewing this page.

  • The Prime Minister stated that there were three Brexit options available to the UK:   295 members have voted

    1. 1. Which of the Prime Minister's options would you choose?


      • Leave with the negotiated deal
      • Remain
      • Leave with no deal

    Please sign in or register to vote in this poll. View topic


×

Important Information

We have placed cookies on your device to help make this website better. You can adjust your cookie settings, otherwise we'll assume you're okay to continue.