Lloyds Banking Group looks set to lose out on £57m following the collapse of the accountancy firm RSM Tenon in August. Administrators at Deloitte expect the taxpayer-backed bank to recover just £29m of the £86m it had lent the company before its pre-pack administration in the summer, according to reports.
RSM Tenon went under this summer after Lloyds refused to let it change the conditions on its debt pile. Administrators then immediately sold the business to rival firm Baker Tilly, which had aborted a takeover bid earlier in the month.
Tenon had expanded rapidly in the lead up to its collapse but was hit badly when the level of corporate activity started to fall two years ago. It plunged into loss last year and its financial advisory business was also hit with a £700,000 fine in 2010 for mis-selling complex financial instruments created by Lehman Brothers.
News of Lloyds’ loss was reported by Insider Publishing. It is believed that the lender had already made provisions against any potential shortfall before Tenon’s collapse.
A spokesman for the bank said: “We supported the company over many months as the business considered its options. Ultimately, the directors of the business felt the challenges could not be resolved without the need for administration. The best offer from the bank and other creditors’ perspective – and which saved more than 2,000 jobs – was the one taken forward with Baker Tilly.”Reuse content