NEW Lloyds chief executive Antonio Horta-Osório was yesterday accused of “kitchen-sinking” his first results at the helm of the bank, bringing forward some charges and potentially overestimating others to give himself a low base from which to improve.
The bank plunged back into the red, reporting pre-tax losses of £3.47bn for the first-quarter of 2011 on the back of a £1.14bn one-off impairment charge from its Irish loan book and a £426m loss on sales of non-core assets.
But asked if he had employed the common “kitchen-sinking” trick, Horta-Osório retorted: “I really do not see any kitchen-sinking in these results.”
Analysts were dubious. “It’s got kitchen sink written all over it,” said one. Evolution Securities’ Arturo de Frias said it was “expected”.
“The new CEO is unlikely to have taken any risks,” he said. Many disagreed, however, with the stock closing down eight per cent at 53.38p.
Horta-Osório’s first-quarter leading the part-nationalised lender has seen a dramatic acceleration in the restructuring of its funding. The bank unloaded £21bn worth of non-core assets, repaid £26bn of government cash and issued £13.5bn of debt. That is twice the rate at which it pursued the same actions last year.