Lloyds Bank has announced staggering loses in the first half of 2009. However, it blames its loses on HBOS, which is took over in January. Lloyds lost about 4 billion pounds in the first 6 months of 2009.
Lloyds is now 43% state-owned, and took on 13.4 billion pounds of write-downs from other struggling companies, so a loss is not really that surprising. However, the value of HBOS at the time of the takeover was lower than thought.
Lloyds is hoping that the write-downs that it has taken on to its books are past the worse, so hopefully by 2010 it could start making a profit again for the UK. If it can follow in Barclays footsteps then success during these hard times is certainly possible.
“Our first half loss was driven by the high levels of impairment. The core business delivered a resilient performance, despite the weak economy.” Eric Daniels, CEO
During the same period in 2008 Lloyds made a profit of 2.8 billion pounds, so apart from the HBOS takeover and the bad debt, its business appears to be running OK. However, it is a bit cheeky to blame the company that you took over for your loses, as it was the board of directors that decided that a takeover was a good idea at the time.
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