Lloyds Banking Group - Last Updated 15 June 2010

LloydsTSB used to be a safe if somewhat boring bank. It had a well diversified portfolio of assets, concentrated in the UK, and was not seen as a high growth stock. But it did pay a high dividend yield and was therefore a favourite share for private investors and those investing for retirement income. HBOS was a company formed from the merger of Halifax (a former building society) and Bank of Scotland. Its business was much more concentrated in the property sector and it had an aggressive growth strategy based on using money market funds to finance increased lending. When HBOS got into difficulties, due partly due to the credit crunch and the difficulties in the UK housing market, it was a surprise when the idea of merging these companies was launched (in reality a takeover of HBOS by LloydsTSB). This proposal required the same "recapitalisation" of the merged company as was being imposed on other banks, so as to strengthen its balance sheet. UKSA issued this press release on the 18th October 2008 highlighting our concerns: Press070. Many LloydsTSB shareholders likewise objected and told the directors of their views in no uncertain terms, but it was pushed through and supported by shareholders (both institutional and private) who held shares in both companies. The result has been an enormous destruction of value, and the cessation of dividends. In addition the latest "Asset Protection" proposals will result in the Government gaining majority control of the company. We have therefore set up a "Shareholder Action Group" to represent the interests of Lloyds Banking Group shareholders. Our objectives are to try and ensure some restoration of value to the original shareholders and to examine some of the legal issues associated with this debacle.

If you wish to register your interest in this campaign then please contact the following: Hannah Marshall, Administrative Assistant, UKSA, email: uksa3@btconnect.com , telephone: 020-8468-1027, UK Shareholders Association, Chislehurst Business Centre, 1 Bromley Lane, Chislehurst, BR7 6LH . Although none of the following is essential (other than a name) it would help to provide the following information: Name, Email address, Telephone number, Postal address and how many shares you hold in Lloyds Banking Group.  Any such information will be held in confidence by UKSA and will be used to communicate with you to provide further information as it becomes available. Please make sure you mention "Lloyds Bank Campaign" in any communication.

KEY ISSUES. The key issues for Lloyds Banking Group shareholders are covered on this page: Key_Issues

The latest news on this campaign is at the bottom of the page.

After issuing the press release mentioned above, there were a number of subsequent notes and press releases issued by UKSA as part of our general campaign on the banking sector (see Bank_Campaign). Some of the ones relevant to Lloyds shareholders are in the following documents: Update_1 , Update_2 , Update_3 , Update_5 , Bank_Nationalisation , Update_8  and Update_9 .

LAUNCH OF SHAREHOLDER ACTION GROUP ON LLOYDS BANK. On the 15th March, UKSA announced the launch of a shareholder action group to promote the interests of private shareholders in Lloyds Banking Group in this press release: Press079 . This and other news was also covered in: Update_10 .

NEWS ON LLOYDS BANKING GROUP. We issued this note: Update_11 on the 4th April which includes a report on a meeting with Sir Victor Blank of Lloyds and some analysis of the Asset Protection Scheme.

TREASURY COMMITTEE REPORT. The following note was issued on the 4th May covering the Treasury Committee report on the Banking Crisis which mentions events at Lloyds and, the Lloyds Banking Group AGM: Update_14

LLOYDS VOTING RECOMMENDATIONS AND INTERIM REPORTS. This note was issued on the interim management reports of Lloyds, RBS and Barclays and also gives some voting recommendations for the Lloyds Banking Group AGM: Update_15. But no sooner had we issued it than Sir Victor Blank announced his departure as Chairman of Lloyds Bank (perhaps he realised that pressure to go was mounting) so we issued this press release: Press082 . A further note on the Lloyds voting recommendations, and brief coverage of the Treasury Committee Report on Corporate Governance and Pay in the City was issued in: Update_16

LLOYDS AGM REPORT. This brief report on the Annual General Meeting of Lloyds Bank and other recent news was issued on the 8th June 2009 (the first specific newsletter from the Lloyds Shareholder Action Group): Update_1 .

NEW CHAIRMAN AND MERGER BENEFITS TO DISAPPEAR? This note was issued about rumours of new Chairman for Lloyds, comments on the looming competition issues, and other recent news: Update_2 .

INTERIM RESULTS. Some comments on the Lloyds Bank Interim results and other news were issued in Update_3

MEETING FOR LLOYDS SHAREHOLDERS. A report on the meeting held for Lloyds Bank shareholders in London on the 31st October is present on this web page: LloydsMeeting for more information. This newsletter was issued inviting people to that meeting, and covering other recent news at Lloyds: Update_4, and a further reminder with additional news on the APS was in this note: Update_5

FINANCIAL STABILITY MEASURES. The following note was issued about the announcements by the Treasury and Lloyds Bank about the termination of the Asset Protection Scheme, and a major rights issue: Update_6

RIGHTS ISSUE VOTING AND TAKE-UP: The following note was issued about the rights issue voting and take-up and Lloyds job cuts.  HBOS investigation and secret loans to HBOS.  Campaign legal action status and fund raising:   Update 7

LLOYDS GENERAL UPDATE FOR WEBSITE : General Update for website. Update 8

DONATIONS TO UKSA'S LLOYDS BANK SHAREHOLDERS ACTION GROUP 

At the close of 2009, the state of the campaign fund raised by UKSA from donations received from Lloyds TSB shareholders was uncertain and campaign activity was suspended.  Accounts have now been published which show that there was a campaign surplus at the end of 2009, the application of which is now being actively considered by UKSA’s directors.  Some costs are still being incurred and there is a need to make certain accounting provisions, but we currently expect there to be a residual amount for disposal.  There will not be a resumption under UKSA’s auspices of any campaigning activity for Lloyds shareholder compensation, so UKSA’s directors are now investigating other possibilities, but the money will not be used for any purpose which is incompatible with the purpose for which it was given. 

In the mean time, UKSA is proceeding with registration of those Lloyds Banking Group shareholders who express an interest in the establishment of a private shareholders’ committee for the Group, about which more information is available from the UKSA office:

Hannah Marshall, Administrative Assistant, UKSA, email: uksa3@btconnect.com , telephone: 020-8468-1027, UK Shareholders Association, Chislehurst Business Centre, 1 Bromley Lane, Chislehurst, BR7 6LH.