His appointment, likely to be confirmed within a fortnight, will end an 18-month hunt for a replacement for Maarten van den Bergh, a member of the British Airways, Royal Dutch Shell and BT Group boards.
Sir Victor will join at a trying time for the country's biggest provider of current accounts. City experts have fretted for some time that the Black Horse bank is looking tired and corralled in a strategic cul-de-sac. It has neither the high-growth emerging markets interests of HSBC or Standard Chartered, nor the American footprint of rivals such as Royal Bank of Scotland. Unlike Barclays, there is no lucrative investment banking business.
At home, an aggressive HBOS - selling cheap products pushed by tough comparative advertising - is not only the country's biggest mortgage lender but also the biggest provider of new savings products.
Sir Victor has extensive experience of banking and retailing, and Lloyds shareholders will hope that he will bring the kind of retail nous that Andy Hornby, a former acolyte of Archie Norman and Allan Leighton at Asda, brought toHBOS.
City guidelines allow for chairmanship of only two FTSE 100 companies at once. It is unclear whether Sir Victor will step down at Trinity, the publisher of the Daily Mirror, or GUS, owner of the Argos catalogue shops and Experian credit-checking business. Should GUS split this year, Sir Victor may be offered a natural departure point.
One of his first jobs at Lloyds will be to resolve the future of Scottish Widows, the life and pensions business it bought for an inflated price in 1999.
Scottish Widows Investment Partnership hired the investment bank Merrill Lynch in April to sound out opportunities. It has held talks about a tie-up with the Belgian-Dutch financial service group Fortis. Poor performance there and elsewhere has made Lloyds appear vulnerable to a bid. Spain's BBVA and Bank of America are touted as potential predators. Lloyds is believed to have sounded out Deutsche Bank and ABN Amro about a possible tie-up.Reuse content