Lord Levene slams Lloyds for 'bad faith' over Project Verde
City grandee accuses Lloyds and Government of acting in "bad faith" over Project Verde sale giving evidence to MPs at Westminters
Lord Levene has accused Lloyds Banking Group and the Government of "bad faith" in the way the auction of more than 600 of the bank's branches was handled.
In the latest hearing on the "Project Verde" process, which ended up with the Co-op Bank’s ill-fated deal to buy the branches, the former NBNK chairman told MPs on the Treasury Select Committee: “In our view they chose to concentrate on all the positive aspects of the Co-op and none of the positive aspects of ours.
“I believe that Lloyds was swayed by political considerations. I would say that their assessment of our bid was not done fairly.”
When asked if this meant he was accusing Lloyds and the Government of “bad faith” Levene, pictured, answered “yes”. “I was told at one stage, quite late, that I should look at the reference to financial services in the Coalition agreement. One of those said it was in the interests of the Coalition to promote the interests of mutuals.
“Clearly the Business Secretary (Vince Cable) was a big supporter of mutuals. He told me that himself when I saw him. I didn’t understand the full implication at the time.”
Asked why he didn’t realise the auction of part of a state-supported bank would be political he said: “We believed we were in a fair process.”
NBNK chief executive Gary Hoffman said the sole reason for rejecting their bid was on the grounds there was “less execution risk” than with Co-op and that it was not on financial grounds. “It was crystal clear to me that the execution risk for the Co-op was extremely high and it would unravel over a short space of time. Which it did.”
Despite the alleged bad faith and his losing £60,000 on NBNK shares, Lord Levene, who is no longer a shareholder, said he would not pursue legal action against Lloyds: “I wouldn’t win any friends [by doing that].”
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