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Company name | Lloyds Banking Group plc | Company type | Public company | Industry | Banking Financial services | Founded | 2009 (Lloyds Bank: 1765) (Bank of Scotland: 1695) (Trustee Savings Bank: 1810) (Halifax: 1853) | Headquarters | London | Area served | Worldwide | Key people | Sir Win Bischoff (Chairman) António Horta-Osório CEO | Products | Retail banking Commercial banking Private Banking General insurance Life insurance Pensions | Revenue | (-) £43.467 billion (2010) | Operating income | (-) £281 million (2010) | Net income | (-) (£258 million) (2010) | Total assets | (-) £991.6 billion (2010) | Total equity | (+) £46.061 billion (2010) | Owner(s) | H.M. Government (41%) | Employees | 104,230 (2010) | Subsidiary | Lloyds TSB Bank plc, Lloyds TSB Scotland plc, Bank of Scotland plc |
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Lloyds Banking Group plc is a major British financial institution, formed through the acquisition of HBOS by Lloyds TSB in 2009. As at February 2010, HM Treasury held a 41% shareholding through UK Financial Investments Limited (see 'Government stake' below). The Group headquarters is located at 25 Gresham Street in London, with its registered office on The Mound, Edinburgh. Lloyds Banking Group's activities are organised into four business divisions: Retail Banking (including Mortgages), Wholesale, Life, Pensions & Insurance, and Wealth & International. Lloyds' extensive operations span the globe including the US, Europe, Middle East and Asia.
Lloyds TSB was formed in 1995 by the merger of Lloyds Bank and the Trustee Savings Bank. The company operated in England and Wales as Lloyds TSB Bank plc and in Scotland as Lloyds TSB Scotland plc. Its other subsidiaries included the mortgage bank Cheltenham and Gloucester, life assurance company Scottish Widows, finance house Black Horse and private equity investor Lloyds Development Capital.
Following the approval of both the Lloyds TSB and HBOS shareholders, the takeover was completed on 19 January 2009. The HBOS name ceased to be used publicly, although it will still exist as an employing entity. The Bank of Scotland brand will remain in Scotland while the Halifax and Lloyds Bank brands will be used in England & Wales, with each offering different products and pricing. In his first interview as Lloyds Banking Group's new CEO António Mota de Sousa Horta Osório told The Banker that "We will keep the different brands because the customers are very different in terms of attitude".
The Group has announced it will sell all Lloyds TSB branches in Scotland, some in England & Wales, the TSB brand, the Cheltenham & Gloucester branches and Intelligent Finance as a consequence of the UK Government taking a 43.4% share in the Group in January 2009.
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Share price history : Divestment (sell-off) |
Lloyds' Re-based Share Price |
Lloyds' Original Share Price |
Date |
Events |
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275 |
550 |
03/07/07 |
Credit Crunch (reduced inter-bank lending) starts, driven by US sub-prime mortgage losses as US interests increase. |
262 |
520 |
13/09/07 |
Northern Rock bank run. |
196 |
395 |
15/02/08 |
One week before Northern Rock nationalisation. |
217 |
457 |
22/02/08 |
Northern Rock nationalised. |
196 |
397 |
17/03/08 |
Bear Stearns (US) takeover proposed. |
137 |
278 |
11/07/08 |
IndyMac Bank (US) failed. Crude Oil peaked at $US147. |
152 |
310 |
07/09/08 |
Fannie Mae and Freddie Mac rescued by US Government. Nationwide Building Society announced takeover of Derbyshire & Cheshire building societies. |
134 |
273 |
15/09/08 |
Lehman Brothers (4th largest US investment bank) bankruptcy. Merrill Lynch's acquisition by Bank of America announced. |
138 |
280 |
17/09/08 |
LTSB / HBOS take-over proposed. |
124 |
251 |
26/09/08 |
Washington Mutual Bank (US) failed. |
108 |
217 |
29/09/08 |
Bradford & Bingley rescued by UK government. Glitnir rescued by Iceland government. The United States Congress rejected proposed $700bn 'bail-out' plan. |
144 |
290 |
03/10/08 |
US government £394m rescue plan for financial services industry. |
112 |
225 |
07/10/08 |
Landsbanki (parent of Icesave) rescued by Iceland government. |
94 |
189 |
10/10/08 |
Inter-bank lending largely frozen by risk concerns. |
79 |
162 |
13/10/08 |
UK Government-proposed re-capitalisation of RBS, HBOS & LTSB announced. UK consumer price index (CPI) peaked at 5.2% due to high energy & food costs. Takeover of troubled US bank Wachovia by Wells Fargo is approved by regulators. |
93 |
188 |
06/11/08 |
UK base rate cut by 1.5% to 3%. |
80 |
162 |
04/12/08 |
UK base rate cut by 1% to 2%, although LIBOR remained high. |
65 |
134 |
19/12/08 |
Global recession gaining pace. Ratings agency Standard and Poor's downgrades its investment rating of a number of so-called monoline insurers, which specialise in insuring bonds. They guarantee to repay the loans if the issuer goes bust. There is concern that insurers will not be able to pay out, forcing banks to announce another big round of losses. (1 week earlier Sanderson State Bank (US) failed � 25th US bank to fail in 2008.) |
51 |
103 |
15/01/08 |
Bank share price falls � Barclays 25% fall. Further US government support package announced. Further UK government support proposed to encourage more lending, but lack of details lead to greater market uncertainty. |
32 |
65 |
19/01/09 |
LTSB / HBOS take-over & government re-capitalisation completes � government stake of 43.4%. Royal Bank of Scotland £28bn losses for 2008 announced. General principles of Government Asset Protection Scheme (GAPS) announced. |
22 |
45 |
21/01/09 |
Intraday low of 24.59 (16.37p re-based). |
50 |
101 |
28/01/09 |
Positive market analyst views (e.g. UBS & Citi). |
30 |
61 |
13/02/09 |
Lloyds confirmation of £11bn loss at HBOS in 2008 (c.£1.6bn more than expected from due diligence). |
22 |
43 |
09/03/09 |
Terms for proposed Lloyds participation in GAPS announced. |
44 |
66 |
05/06/09 |
Lloyds £4bn Open Offer (to redeem government preference shares) completed with new shares issued at 38.43p � UK government participated as existing shareholder so stake remained at 43.4%. |
62 |
93 |
05/08/09 |
Lloyds Interim Results. Eric Daniels (CEO) stated that losses on bad loans for the whole Group had peaked in the first half of 2009, due to heavy write-downs made on HBOS corporate property loans. (Losses on retail loans expected to increase in-line with unemployment , but those losses expected to be much less than the corporate property ones.) |
74 |
111 |
28/08/09 |
Continuing media speculation about Lloyds rights issue and reduced GAPS participation. |
73 |
109 |
23/09/09 |
Lloyds raises £4bn from wholesale markets without UK government guarantees through first European issue of Residential Mortgage Backed Securities (RMBS) in over a year. |
62 |
93 |
16/10/09 |
Lloyds sells Halifax Estate Agents. |
58 |
87 |
03/11/09 |
Confirmation of Rights Issue @37p, exit from Government Asset Protection Scheme, EU Competition-required sell-offs. |
55 |
55 |
14/12/09 |
Rights Issue completed with 95.3% take-up. Rump placed @55.5p. |
47 |
47 |
12/02/10 |
Confirmation that new shares would be issued as final part of December 2009 capital raising � all existing shareholdings diluted. Government shareholding reduced from 43.4% to c.41% |