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Lloyds Braced For £13bn Writeoff

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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.

Losses accelerating but the recovery is here, this does not compute.

Will Llodys soon be fully nationalised?

I bet the shareholders are so pleased with the takeover of HBoS, instead of one bank collapsing the govt appears to have sunk 2 banks in one go.

Excellent work.

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

Losses accelerating but the recovery is here, this does not compute.

Will Llodys soon be fully nationalised?

I bet the shareholders are so pleased with the takeover of HBoS, instead of one bank collapsing the govt appears to have sunk 2 banks in one go.

Excellent work.

Must be nearly up to their loss limit already. Then all the rest of the shit is a loss to the taxpayer.

http://money.cnn.com/2009/03/07/news/inter....reut/index.htm

Lloyds will pay a £15.6 billion fee to participate in the deal, and will take the "first loss" of up to £25 billion on the assets. Thereafter, the government will assume 90% of any losses on the value of the assets.

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ridiculous article.

there is no subprime in the UK. All loans were properly vetted, checked, and issued with appropriate charges and security as to risk, to protect savers interests.

Not only that, UK is best placed in the Universe to weather the storm, which began in Amerwica and will be over by Christmas.

and as for the war on terror, Al QEEEEEAIDA is on run, as pronounced by HRH G Broon.

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

Losses accelerating but the recovery is here, this does not compute.

Will Llodys soon be fully nationalised?

I bet the shareholders are so pleased with the takeover of HBoS, instead of one bank collapsing the govt appears to have sunk 2 banks in one go.

Excellent work.

The most interesting quote was the following:

"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."

That's like saying: "if we hadn't lost a bundle on that contract we'd be doing OK!"

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The most interesting quote was the following:

"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."

That's like saying: "if we hadn't lost a bundle on that contract we'd be doing OK!"

looks ripe for a Good Bank, Bad Bank Split.

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looks ripe for a Good Bank, Bad Bank Split.

Yes and I don't know why this hasn't been discussed more. There's been some talk of people like Tesco(?) starting up a bank but no rush that I can see to do this.

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The most interesting quote was the following:

"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."

That's like saying: "if we hadn't lost a bundle on that contract we'd be doing OK!"

That reminds of the nuclear argument, I can remember one official saying nuclear energy was cost effective if you exclude the decommissioning costs. :blink:

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