The TSB chain is set to return to the nation’s high streets next month, Lloyds said today.
The 631 branch chain will be backed by a £30 million marketing and rebranding campaign and have a new independent chairman and board paving the way for its stock market spin-off from Lloyds by the middle of next year.
Coupled with the immediate start of negotiations with the banking regulator over restarting dividend payments which were suspended in mid-2008, the way is now open for the Government to begin the sell-off of the taxpayers’ 39% stake in Lloyds.
“We have enabled the Government to begin the process of delivering the group back to full private ownership,” said chief executive Antonio Horta-Osorio.
Lloyds swung back into the black in the first half of this year making a profit of £2.13 billion against a loss of £456 million a year ago. And underlying profits - watched by the City - almost trebled from £1 billion to £2.9 billion.
But yet again Lloyds was hit by past issues taking another £500 million charge for mis-selling which takes the total its has put aside for wrongful selling of payment protection insurance to £7.3 billion - almost half the total £15.2 billion PPI provisions made by the big four High Street banks.
The latest charge includes an extra £50 million for handling the Financial Conduct Authority’s probe into how Lloyds dealt with complaints over PPI but that covers only the administrative costs and not any potential fine.
Horta-Osorio admitted the total PPI costs were large and that he was “disappointed” to be topping them up again.
But overall, he said, Lloyds had more than achieved on the strategy which he outlined for the bank two years ago. He said: “We are delivering quarter on quarter improvement in a sustainable and boring way like a good retail and commercial bank should. A strong performance in the first half of the year has further strengthened the bank, making it more efficient and focused on our UK customers. We are profitable, we are supporting the UK economy and that has enabled the Government to begin the process of returning the group to private ownership.”
Horta-Osorio said that Lloyds would start discussions with the Prudential Regulation Authority immediately on restarting dividend payments which were suspended in mid-2008. He said these negotiations would probably take until the end of the year but would not comment on whether this could allow Lloyds to pay a final dividend this year.