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Tuesday, November 24, 2009

Lloyds Takes More Taxpayer Money

Lloyds Banking Group, the once proud bank that was wrecked by Gordon Brown when he persuaded its board to take over the toxic HBOS, is draining the taxpayer of even more money today.

Lloyds is raising £13.5BN via a rights issue. As such the government will be pumping another £5.7BN of our money into the bank, in order to maintain our current holding of 43%.

Lloyds wants the money so that it can avoid participating in the government insurance scheme for its bad debt.

The scheme would have protected Lloyds against worse than expected losses on its toxic assets. However, the government would have demanded a greater share in the bank in return.

I am sure Lloyds now bitterly regrets ever allowing itself to be persuaded by Brown to takeover HBOS.

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