POLITICAL pressure applied behind the scenes stopped NBNK buying the 632 Lloyds branches and led to the disastrous Co-op Bank attempt to take over the branches, NBNK’s former boss Lord Levene told MPs yesterday, citing conversations with Lord King.
Levene said the then-Bank of England governor had warned him politicians would block his bid.
NBNK was established by major investors with the aim of buying the branches and establishing a new high street bank.
But Lloyds rejected its bid in favour of the Co-op Bank, arguing the Co-op was prepared to pay more and had a better chance of completing on the deal because it already ran a bank.
However, Levene said the decision was made because politicians pressured Lloyds. Even Lord King told him “this is going to be a political decision,” Levene told the Treasury Select Committee.
His evidence directly contradicts that given by Lloyds’ bosses in earlier parliamentary hearings.
The failed bidder said he would have had a good chance of buying the banks if the process had been carried out “by fair means rather than foul.”
Lloyds, the Treasury and the Bank of England declined to comment.