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12/01/2009
Taxpayers To Own Almost Half Of 'Super-Bank'
Taxpayers are set to own almost half of the "super-bank" created from Lloyd's TSB takeover of HBOS.
The Treasury were forced to purchase 43.3% of the newly named Lloyds Banking Group, after £13 billion new shares to strengthen the company's finances were snubbed by existing investors.
The deal is expected to gain court approval in Edinburgh later today.
HBOS said just 0.24% of the 7.5 billion shares it offered to raise £8.5 billion were taken up.
Lloyds TSB saw just 0.5% of its 2.6 billion new shares to raise £4.5 billion bought by existing investors.
Based on Friday's closing prices, the taxpayer is sitting on combined losses of around £3.5 billion on its stakes in both companies.
Lloyds TSB chief executive Eric Daniels said: "We are pleased that the capital-raising process has completed and that the new, combined group will have a strong financial position.
"We understand that many existing shareholders did not participate because of the divergence between the offer price and the current market price."
The Government is also a majority shareholder in stricken Royal Bank of Scotland - owning almost 60% of the bank.
(JM)(BMcC)
The Treasury were forced to purchase 43.3% of the newly named Lloyds Banking Group, after £13 billion new shares to strengthen the company's finances were snubbed by existing investors.
The deal is expected to gain court approval in Edinburgh later today.
HBOS said just 0.24% of the 7.5 billion shares it offered to raise £8.5 billion were taken up.
Lloyds TSB saw just 0.5% of its 2.6 billion new shares to raise £4.5 billion bought by existing investors.
Based on Friday's closing prices, the taxpayer is sitting on combined losses of around £3.5 billion on its stakes in both companies.
Lloyds TSB chief executive Eric Daniels said: "We are pleased that the capital-raising process has completed and that the new, combined group will have a strong financial position.
"We understand that many existing shareholders did not participate because of the divergence between the offer price and the current market price."
The Government is also a majority shareholder in stricken Royal Bank of Scotland - owning almost 60% of the bank.
(JM)(BMcC)
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