NBNK still confident on Lloyds bid
THE company bidding against Co-op Bank for the 632 bank branches being sold off by Lloyds Banks through the Project Verde disposal has said it remains confident its offer “can deliver the best operational and financial outcome” for Lloyds and its shareholders”.
NBNK Investments, the quoted vehicle set up to acquire a major banking asset, put in a renewed offer for the assets Lloyds is selling off in March. The company, which was founded by Lord Levene and is run by former Northern Rock chief executive Gary Hoffman, also said that the FSA has indicated that it is happy with the form of its bid thus far.
“The company believes that Verde represents a unique opportunity to create a new nationwide entrant into high street banking which is focussed on customers and able to compete with the incumbent providers,” it said.
“NBNK can create what everyone wants: a safe, secure and successful UK-focused consumer and small business bank and it can be achieved years ahead of the Independent Commission on Banking’s 2019 target.”
Lloyds Bank is being forced to offload assets including the bank branches and a loan portfolio as a condition of state aid ruules following its rescue of Bank of Scotland in 2008.
Mr Hoffman said: “Having continued to engage constructively with Lloyds, I believe we have provided sufficient information to enable negotiations to progress for the sale of Verde to NBNK.”
The Co-operative Bank was named as preferred bidder for the Project Verde assets back in December, but its bid has hit regulatory snags, with the FSA reportedly concerned about the level of knowledge and the capital required to run such a major banking operation.
However, reports earlier this month indicated that Lloyds and Co-operative were now working up a proposal to the SFSA where an interim Lloyds team currently running the operation would transfer permanently and remain in charge of the assets. The branches would also continue to use Lloyds’ IT platform.
NBNK this morning reported a loss of £23.2m this morning, which has been due to costs incurred while drawing up potential bids for several banking assets. It had previously been looking to bid for Northern Rock’s assets but abandoned this process to concentrate on the Lloyds bid.
It also assessed the potential to buy-out Clydesdale and Yorkshire Banks from parent company National Australia Bank, but said the that it could not reach a deal “which we would have been able to recommend to our shareholders”.
