Lloyds Banking Group (LBG) continues to make good progress on its mandated retail and commercial divestment (Project Verde).
The Group continues to have productive and meaningful discussions with the Co-operative Group (Co-op), its preferred buyer for the Verde business.
However, LBG is no longer holding these discussions under an exclusivity agreement. Given the renewed interest in the Verde business shown by NBNK, LBG will now consider detailed discussions with other parties but only once LBG is satisfied that any proposal is likely to achieve the appropriate regulatory clearances and offers greater value and/or certainty to LBG shareholders against its alternative option of an Initial Public Offering (IPO). LBG continues to progress work on an IPO option where Verde will be a standalone bank with separate supporting corporate functions, based on proven Lloyds’ systems and infrastructure.
LBG will provide a further update on the progress of Project Verde by the end of Q2 2012
Background
We’re transferring part of our business, including some of our branches and most of the accounts held at those branches, to a new owner. On 14 December 2011, we announced that The Co-operative Bank is the preferred bidder, and we are currently continuing negotiations with them. We will keep you informed of progress with The Co-operative Bank.
At the same time we’re continuing to pursue the option of an Initial Public Offering (IPO), where shares in a new bank would be offered to investors through a public flotation.
Why this is happening
In 2009, the European Commission (EC) ruled that we should sell part of our business to a new owner by the end of 2013. The aim of the ruling is to improve competition and increase customer choice in the UK banking sector.
The transfer includes some Lloyds TSB branches in England and Wales, all Lloyds TSB Scotland branches, all Cheltenham & Gloucester branches and Intelligent Finance and St James’s Place Bank. Once the transfer is complete, the staff and customers of the selected branches will stay with that branch. So if you and your account are included in the transfer, the same staff will continue to provide you with the same level of service, in the same place, just under new ownership.
No branches are closing as part of the transfer and after the transfer is complete, Lloyds TSB will still have a strong network of over 1,300 branches in England and Wales, we’ll carry on offering a wide range of products and services to our customers.
Next steps
We’ll continue our discussions with The Co-operative Bank. The Co-operative Bank has a strong record in delivering good customer service and competitive products that customers want and value. If the sale is agreed, they’ll have over 900 high street branches and be a leading bank in the UK. Any sale or IPO is subject to regulatory approval.
We’ll also carry on looking at the option of an IPO, where we’d offer shares in a new bank to investors through a flotation on the London Stock Exchange.
Keeping you up to date
If you are directly affected by the transfer we’ll be writing to let you know what this means for you, and will keep you up to date at every stage. You don’t need to do anything differently as there will be no changes for some time and your branch will not close as part of the transfer. You can carry on banking just as you do now using the same account details, branch, Internet Banking, Telephone Banking and Lloyds TSB Cashpoints®.
We’ll be updating our website with further information throughout the process, so check for updates in the future.
You can find a list of the branches that will be included in the transfer here.
