UK taxpayers set to become part owners of new Lloyds TSB ‘ superbank’

Articles

UK taxpayers set to become part owners of new Lloyds TSB ' superbank'

It was difficult to detect signs of happiness on the faces of the average UK taxpayer yesterday when the news rapidly spread through sub zero temperature Britain that the government was about to become proud owners of 43% of the shares on this newly formed "mega- bank".

For those of you who remain unaware, the super new Lloyds TSB grew from their possibly ill timed rescue takeover of the HBOS group. The new banking group is to be known as the Lloyds Group, and will undoubtedly be a key player in the decimated banking system of UK today, and in the future.

Chancellor Alistair Darling may have been entitled to expect more when he decided to put shares in the group out to tender. However the results were less than inspiring and display the total lack of confidence in the UK's immediate financial future. Of the £13 billion in new shares on offer, floated by the group to shore up their weakened finances, less than one per cent was actually taken up. This meant that the UK Treasury was left with no option but to dig deep and pick them up.

The figures breakdown makes for cruel reading. Of the 7.5 billion shares on offer of HBOS valued at £8.5 billion ,less than quarter of a percent (around £20,000,000) were actually taken up. Lloyds did proportionally better with just more than half a percent of their £4.5 billion issue being bought.

Eric Daniels, Lloyds TSB chief executive seemed unfazed by lack of the financial institutions interest and quoted: "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." He summed up.

To widen the smile on the faces of the UK public even more, as well as its share in Lloyds-HBOS, the Government is also a majority shareholder in the financially challenged Royal Bank of Scotland, where more than half of shares in the bank are in public hands Shareholdings in UK banks will be overseen by a new public company to be known as UK Financial Investments (UKFI).