Lloyds Banking Group Profit

Lloyds Banking Group Profit.

Lloyds Banking Group (the merger of Lloyds TSB and HBOS Halifax Bank of Scotland) has finally returned to profit.

The bank is 40% state owned following a bailout during the credit crunch crisis and has made a profit in the first 6 months of this year of £2.1bn.

This is fuelling speculation that the government will look to sell off its share in the bank and by segmenting it.

Our View

We are aware that already, Lloyds Banking systems are being segmented internally in preparation for a sell off with many clients actually being switched bank accounts to Lloyds TSB and others to other "brands".

Consumers will see no difference at present but it is happening.  It will be difficult for the bank to sell off its toxic debt side but that said, given that share prices are high, it is a good time for government to realise its share for the people.

Expect developments over the coming months.  No doubt a new buyer will be found for the 600+ branches that are up for sale and it is likely that personal banking and investment banking will be segmented.