Lloyds Banking Group is trying hard to satisfy the British taxpayer!

Back in October 2008, when the then Labour government was forced to bail out RBS and Lloyds, British taxpayers were not happy at having to bear the brunt of what many believed were the feckless and reckless actions of greedy bankers. These bailouts have led to continued criticism of both the former Labour government and the current coalition government from many areas. This is especially true given that the US Government has managed to sell its positions in the financial institutions it was forced to bail out, whereas the share prices of Lloyds and RBS have simply not reached a level which would allow the British government to get an acceptable return on investment.

These last few days seem to have been typical of the complications that Lloyds has faced in trying to restructure. Just last week, after a number of months of pre-deal “courting”, the Co-op Bank stated that it was withdrawing completely from the £750m discussions it had been having with Lloyds over the acquisition of 631 branches. Lloyds subsequently announced it is considering an initial public offering (IPO) as an option for offloading the branches, and given the public perception of the bank and the state of the IPO markets, it will be interesting to see if this can be achieved.

2013 has seen Lloyds sell a number of non-core assets, like St James Place, its independent wealth management business, and Countryside Properties, the UK-based estate agency. Just this morning Lloyds announced it has accepted an offer from Spain’s Banca De Sabadell for Lloyds Bank International, its Spain-based banking services division, and Lloyds Investment España SGIIC, its national investment fund management division also located in Spain.

Good news on the face of it; however, according to press reports, when you look more closely the structure of the deal will mean that Lloyds makes a loss on this deal of around £250m.

Filed under: IPO, M&A, taxpayer, UK, Banking