Monday, September 09 14:16:25
More than 600 bank branches being rebranded as TSB by Lloyds Banking Group could be bought by a trade or financial buyer before a flotation being planned for next year, the head of the new business said.
Lloyds was ordered to sell the branches by European regulators as a penalty for receiving a 45.5 billion pound ($71.11 billion) government bailout in the 2008 financial crisis.
It plans to run the business on a standalone basis ahead of a listing in summer 2014 but TSB's new boss Paul Pester said that could change.
"It's absolutely possible that someone may come in and say this is a fantastic business we'll make you an offer for it. That's something we can leave Lloyds to deal with," Pester told reporters at the launch of the new business in central London.
TSB will become Britain's 8th biggest retail bank with 4.5 million customers and a 4.3 percent share of the current account market.
Lloyds' Group Retail Director Allison Britton told Reuters that the bank is aiming for a stock market listing in the summer of 2014 and that the sale of the business would be done in stages.
"It will be quick. We set ourselves a number of goals - finishing this divestment, repaying the government, returning to dividends and profitability. The sooner we can do all of those things the better," she said.
Britton said she anticipated investor appetite for the stock, despite a number of other bank share issues scheduled for the coming months including a rights issue by Barclays, the sale of the government's stake in Lloyds itself, and a possible listing of 315 branches by Royal Bank of Scotland .
"It's a nice balanced strongly-capitalised fully UK-orientated bank with a good distribution network. I think it'll be a great stock but it all comes down to the market and the price on the day," she said.
The return of the 200-year-old TSB brand to the high street after an 18-year-absence is the result of action by regulators and the government to introduce greater competition for the country's banks.
Other steps include the relaxation of capital requirements for new entrants and the introduction of rules requiring banks to ensure customers can switch accounts within a week which come into effect on Sept. 16.