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Lloyds bank announces terms of fundraising

Lloyds bank has today announced that the company has received across-the-board support for a bond exchange program and the company's £13.5 billion rights issue. All in all, the company refinancing will total around £22.5 billion, an increase from the initial estimate of £21 billion. The £13.5 billion rights issue is a record in the UK in itself although this does grow when you also take into account the bond refinancing.

This is the latest phase in the rebuilding of the Lloyds bank balance sheet which has undergone some dramatic changes over the last 24 months. The company is also under pressure from the EU after receiving state aid to bail out the operation, after the disastrous acquisition of HBOS. There was also the subject of the government's asset protection scheme, which the company initially signed up to, although it later decided against taking up this option.

Over the last 12 months we have seen a massive change in the make-up of the Lloyds bank board of directors with a new chief executive and numerous new directors joining the group. The company is now ultimately controlled by the UK government and despite numerous attempts by the Lloyds bank directors to minimise the shareholding held by the government, there is still a lot of political influence behind the scenes.

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