LSB still in talks as losses soar

TROUBLED Manchester finance house London Scottish Bank said it is still in talks with a number of parties about a takeover of the group.

LSB, which wants to get rid of its consumer lending business that has racked up losses of £16.7m this year as customers struggle to cope with rising bills, revealed that it still has a £12m shortfall in regulatory capital despite reducing assets and the sale of its factoring business.

In a statement to the stock market, LSB said it had made headway in restructuring the business to focus on its debt division, however admitted that volume growth in Robinson Way’s  debt purchase portfolio was behind plan.

LSB added that Robinson Way needs to raise a minimum of £32.5m in regulatory capital by 31 October, if the amount is not raised the group has agreed to sell the business by June 2009.

LSB chairman Peter Cordrey said: “Management has made good progress in refocusing the group around its successful debt purchase and debt collection division, Robinson Way, while continuing to reduce the capital employed in its lending divisions.

“Robinson Way and London Scottish Mortgages continue to trade profitably, however, the group as a whole is loss making, primarily due to continuing losses in the unsecured Consumer Credit division.”