The Co-operative Group is bidding to acquire 632 Lloyds Bank sites which are being disposed of to comply with a European Commission ruling in the wake of the financial crisis.
Lloyds Banking Group hope to finalise a deal before the end of the year to sell the branches after being ordered to do so following the injection of billions of pounds of taxpayers’ money during the international banking meltdown.
A Co-operative Bank spokesman confirmed that an undisclosed indicative offer had been made for the sites, which — if successful — would be a “game changer” for the Bank.
Following the acquisition through merger of Britannia, the Co-operative Bank currently has over 350 high street branches, so the addition of 632 Lloyds sites would clearly transform the business.
But although the Bank is among the bidders, it faces tough competition as, reportedly, bids have also been submitted by Virgin Money and by NBNK, a bank buyout vehicle led by outgoing Lloyds of London chairman Lord Levene.
Reportedly, all three bids are “at the lower end of the £2bn to £3bn range”. And it has also been claimed that the National Australia Bank, owners of the Clydesdale Bank, are also in discussions with Lloyds about acquiring the branches.
The Co-operative Bank has declined to comment on press speculation that they are the ‘front-runners’ to acquire the branches and point out that the process is being driven by Lloyds.
In addition to the branches, the package up for sale includes 19 per cent of Lloyds’ mortgage book and part of the company’s current account portfolio, which — if the bid is successful — would give the Co-operative Bank a seven per cent share of this market.
• This article has been updated from the print edition to clarify that the Co-operative Group, rather than the Co-operative Bank, is bidding for Lloyds.