Lloyds chairman and chief executive to face MPs
LLOYDS Banking Group executives are set to be grilled by a committee of MPs over the failure of its £750 million deal to sell hundreds of its branches to the Co-operative Bank.
Outgoing chairman Sir Win Bischoff and chief executive Antonio Horta-Osorio are understood to have been invited to appear before the Treasury select committee to give their views on the failure of “project Verde”.
Lloyds, which is 41 per cent tax-payer owned, has been forced to sell 632 branches by the European Commission as a condition for receiving government support.
The deal collapsed in April after the Co-op walked away citing the economic downturn and a tougher regulatory environment for banks. Credit agency Moody’s thereafter downgraded the Co-op’s creditworthiness to “junk” status after it warned the lender could require “external support” to fill a £1 billion hole in its balance sheet.
It is thought that Peter Marks, the recently-departed chief executive of the wider Co-op Group, is also expected to be called before the committee.
It is expected Horta-Osorio will be asked why the bank continued plans to sell the branches to the Co-op after delays had hit the deal, giving rise to concerns that it might not complete.
The Lloyds duo are also expected to be asked why Lloyds selected the Co-op’s bid ahead of a rival offer from investment vehicle NBNK.
Lloyds has confirmed it plans to float the bank branches - which will be called the TSB Bank - as a stand-alone business on the London Stock Exchange.