Posted on 07/12/2009 9:30:17 PM PDT by lainie
LLOYDS Banking Group is set to reveal £13 billion worth of write-offs on bad debts when it releases results for the first six months of 2009, it was reported yesterday. When group chief executive Eric Daniels unveils the interim results in August, the bank will report another huge hit on its commercial property, business and mortgage loans, despite suggestions that the worst of the recession is over.
Analysts at UBS calculated the bank will see pre-tax losses of more than £6bn for the first half of the year alone. Total write-offs at Lloyds 43 per cent owned by the taxpayer could top £20bn this year, handing further ammunition to critics who have already declared the merger of conservative Lloyds with HBOS a disaster.
Lloyds which has already warned investors that it will be loss-making this year said in May that corporate bad debts would be more than 50 per cent higher than last year. In 2008, the banking group revealed approximately £7bn of impairments in the HBOS corporate division.
The write-downs continue to stem from the riskier property exposure in HBOS's corporate lending book, after the bank's new owner took a more conservative view of its debts.
However, the bank will also suffer higher defaults in its mortgage lending book this year as unemployment rises and more households are unable to make repayments.
Lloyds is still in talks with the government about placing £260bn in toxic debt mostly from HBOS into a taxpayer-backed insurance scheme to strengthen its balance sheet.
A Lloyds spokesman declined to comment ahead of the results.
“Lloyds is still in talks with the government about placing £260bn in toxic debt mostly from HBOS into a taxpayer-backed insurance scheme to strengthen its balance sheet.”
Ohhhhhhhhhh, this really is not good...
fyi
I think they didn’t spell “Madoff” right
Thanks for the ping.
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