Is Lloyds bank set to hit the market for £15 billion fundraising?
Lloyds bank appears set to raise up to £15 billion from existing shareholders as the group moves to reduce the cost of the government's toxic debt insurance plan. The move appears to have the tentative backing of the UK government, which is a 43% shareholder, although recent results from the company were far from pleasing for existing shareholders.
When you consider that Lloyds bank has already raised £4 billion from shareholders this year, HBOS (now part of Lloyds bank) has itself raised £4 billion and government injected £11 billion into the business earlier this year, this would take total funds raised to in excess of £30 billion this year. While there has been no official confirmation from the company it appears to be common knowledge within the city that the group is set to do a "kitchen sink job" and push all bad news out of the way as soon as possible, clearing the decks for the future.
Lloyds bank is now a totally different animal to the one which shareholders became accustomed to prior to the acquisition of HBOS. The conservative policies of the past have disappeared, debt has increased, bad debts have mushroomed and the business is literally dependent upon further a fundraising.
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