REGULATORS are set to rule that Lloyds’ proposals to sell hundreds of branches will boost competition to an acceptable degree, accelerating the chances of an imminent sale of the part-state-owned bank.
It is thought the Office of Fair Trading (OFT), which is examining how disposals will affect competition in the banking sector, will approve of plans by Lloyds to dispose of hundreds of branches, which are going to form the newly minted bank TSB.
Plans by RBS to sell branches are also close to being backing by the OFT, according to Sky News.
The news comes as TSB said it will not launch new products until the new year as it focuses on retaining those it has been given from Lloyds.
Immediately launching new services would be “crazy” according to TSB boss Paul Pester, who wants the changeover to be more gradual. The bank has been set up with 4.6m customers across 631 branches, which were automatically transferred from Lloyds. It is part of a European Commission plan to boost competition in the sector after the bank bailouts in 2008.
But as those customers had no choice in moving over, the TSB is focusing on keeping them happy before it chases those from other banks.
“The most important thing as we establish this bank is to make sure our customers know where the branches are, can find the website and the phone numbers,” Pester said yesterday.
“If we were to change all of our products and services on day one that would be a bit of a crazy thing to do.”
When it launches new products the bank should be well placed to offer a good deal as it does not have any bad loans hanging over it, or the costs of scandals like PPI mis-selling which have been left with the Lloyds group.