Lloyds branch sell-off 'on track'
Part-nationalised Lloyds Banking Group has insisted that its EU-imposed sale of 632 branches is on track as it unveiled a huge loss in the first half of the year.
Lloyds, which is 40.2% state-owned, reported a £3.3 billion pre-tax loss in the six months to June, compared to a £1.3 billion profit last year, as the cost of the payment protection insurance (PPI) scandal took its toll.
The UK's biggest lender, which owns Halifax, Bank of Scotland and Cheltenham and Gloucester, set aside £3.2 billion to cover compensation for customers who were mis-sold PPI.
Lloyds is being forced by the EU to sell branches in return for the £20 billion in state aid it received following the 2008 credit crisis.
Chief executive Antonio Horta-Osorio refused to confirm the number of organisations who have approached the bank over the sale process after reports suggested interest had been disappointing.
He said: "We can confirm we have had a number of credible approaches and they have been in line with our expectations." He added: "We are confident we will find a buyer."
Lloyds is understood to be in talks with six parties, of which only two - new bank venture NBNK and Co-Op Bank - have made formal expressions.
Stripping out the provision set aside for customers mis-sold PPI, the bank saw underlying profits plunge 31% to £1.1 billion as it struggled with the "subdued" economic climate.
Mr Horta Osorio, who announced 15,000 job losses in his vision for the business in June, said the performance was "resilient" despite the economic challenges and regulatory uncertainty.
Lloyds also said it was on track to meet its full year target for the Project Merlin agreement with the Government, after it extended £21.2 billion of gross lending to businesses in the period, including £6.7 billion for small businesses. Shares were down more than 4% after the results were published.