NBNK in new bid for Lloyds branches

City A.M. Reporter
New British banking venture has made a fresh bid for 632 Lloyds retail bank branches, putting it back in competition for the assets with shops to banking group The Co-Op, which has faced problems convincing regulators on its offer.

NBNK said it was offering an "alternative demerger structure" for the Lloyds branches, which are estimated to be worth about £1bn.

It wants to underwrite 100 percent of the asset package demerger, offering Lloyds shareholders - including the UK taxpayer - the option of receiving cash directly and/or receiving shares in a new, listed banking group.

Lloyds has been ordered by European regulators to sell the branches by November 2013, as payback for being bailed out with taxpayers' money during the 2008 credit crisis, which resulted in Britain ending with a 40 per cent stake in Lloyds.

NBNK lost out to Co-Op last year in its bid to become Lloyds' preferred bidder in the branch sale, which has been codenamed "Project Verde", but both Lloyds and Co-Op said last month the sale was proving to be complicated.

Co-Op Chief Executive Peter Marks told reporters he could not guarantee he would pull off the deal, and NBNK has always been hovering in the wings.

NBNK pledged that its takeover of the Lloyds branches would not result in any redundancies or branch closures.

"Our objective is to create a new, large challenger bank and brand that will shake-up UK high street banking, operating in the interests of customers," said NBNK Chief Executive Gary Hoffman, previously a boss at UK bank Northern Rock.