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| Lloyds sees HBOS loss of £10.8bn | Lloyds sees HBOS loss of £10.8bn |
| (30 minutes later) | |
| Lloyds Banking Group has said that HBOS, which it absorbed in January, made a pre-tax loss of £10.8bn in 2008. | Lloyds Banking Group has said that HBOS, which it absorbed in January, made a pre-tax loss of £10.8bn in 2008. |
| Meanwhile, Lloyds TSB has seen its own profits for 2008 fall by 80% to £807m, in what is said was a "resilient underlying business performance". | Meanwhile, Lloyds TSB has seen its own profits for 2008 fall by 80% to £807m, in what is said was a "resilient underlying business performance". |
| Lloyds also said it was in talks with the Treasury about placing toxic assets in the government's new asset protection insurance scheme. | Lloyds also said it was in talks with the Treasury about placing toxic assets in the government's new asset protection insurance scheme. |
| It is 43% owned by the taxpayer which has provided £17bn in support so far. | It is 43% owned by the taxpayer which has provided £17bn in support so far. |
| Cost savings | Cost savings |
| The banking group said it faced another "challenging year" in 2009. | The banking group said it faced another "challenging year" in 2009. |
| Its shares were down 12% at 66 pence in early trade in London. | Its shares were down 12% at 66 pence in early trade in London. |
| Eric Daniels, Lloyds Banking Group chief executive, said more than £100m in cost savings had been identified. | Eric Daniels, Lloyds Banking Group chief executive, said more than £100m in cost savings had been identified. |
| He said there would be some staffing reductions, but that most of those were expected to be achieved through natural turnover and voluntary retirement plans. | He said there would be some staffing reductions, but that most of those were expected to be achieved through natural turnover and voluntary retirement plans. |
| Lloyds said talks with the UK government on an asset insurance scheme "are progressing and are well advanced", and Mr Daniels said he would provide an update "reasonably shortly". | Lloyds said talks with the UK government on an asset insurance scheme "are progressing and are well advanced", and Mr Daniels said he would provide an update "reasonably shortly". |
| It had been expected to reveal it was placing more than £250bn of assets into the plan. | It had been expected to reveal it was placing more than £250bn of assets into the plan. |
| 'Excellent brands' | 'Excellent brands' |
| HBOS was hit by £9.9bn of losses on bad loans. | HBOS was hit by £9.9bn of losses on bad loans. |
| The huge losses announced by Lloyds Banking Group further illustrate the dire straits in which the financial system finds itself Derek Simpson, joint leader of union Unite | The huge losses announced by Lloyds Banking Group further illustrate the dire straits in which the financial system finds itself Derek Simpson, joint leader of union Unite |
| At Lloyds, losses caused by "market dislocation", the slowdown in the UK economy, and the impact of falling house prices, came to £3bn. | At Lloyds, losses caused by "market dislocation", the slowdown in the UK economy, and the impact of falling house prices, came to £3bn. |
| Referring to its takeover of HBOS, Lloyds said that it had "acquired a franchise that brings extensive distribution, a large customer base, good people and excellent brands". | Referring to its takeover of HBOS, Lloyds said that it had "acquired a franchise that brings extensive distribution, a large customer base, good people and excellent brands". |
| When the deal was originally announced in September, the government backed the move using a special national interest clause, on the grounds that a collapse of HBOS would have had a disastrous impact on the UK. | When the deal was originally announced in September, the government backed the move using a special national interest clause, on the grounds that a collapse of HBOS would have had a disastrous impact on the UK. |
| This got around any potential anti-competition objection. | This got around any potential anti-competition objection. |
| The new Lloyds Banking Group controls about 25% of British customers' personal bank accounts and about 28% of the mortgage market. | The new Lloyds Banking Group controls about 25% of British customers' personal bank accounts and about 28% of the mortgage market. |
| Sector-wide woes | Sector-wide woes |
| It comes a day after Royal Bank of Scotland revealed a record UK loss of £24.1bn and a new bail-out worth up to £25.5bn. | It comes a day after Royal Bank of Scotland revealed a record UK loss of £24.1bn and a new bail-out worth up to £25.5bn. |
| Chris Skinner, an independent banking analyst and chairman of the Financial Services club, said: "At least they [Lloyds] made a profit, which is better than the Royal Bank of Scotland." | Chris Skinner, an independent banking analyst and chairman of the Financial Services club, said: "At least they [Lloyds] made a profit, which is better than the Royal Bank of Scotland." |
| HAVE YOUR SAYBank profits and salaries should be capped, and banks should focus on serviceMichael, BrentwoodSend us your comments | |
| "We know the short-term outlook for the enlarged group is challenging," said Lloyds chairman Sir Victor Blank. | "We know the short-term outlook for the enlarged group is challenging," said Lloyds chairman Sir Victor Blank. |
| "Whenever economic conditions do begin to normalise, however, we believe we will be in a very strong position to reap the benefits." | "Whenever economic conditions do begin to normalise, however, we believe we will be in a very strong position to reap the benefits." |
| Lloyds' five executive directors have all voluntarily agreed to forego any bonus they may be awarded for 2008. | Lloyds' five executive directors have all voluntarily agreed to forego any bonus they may be awarded for 2008. |
| "The huge losses announced by Lloyds Banking Group further illustrate the dire straits in which the financial system finds itself," said Derek Simpson, joint leader of union Unite. | "The huge losses announced by Lloyds Banking Group further illustrate the dire straits in which the financial system finds itself," said Derek Simpson, joint leader of union Unite. |
| "More than ever, it is essential that the new Lloyds Banking Group retains and protects its hard working staff." | "More than ever, it is essential that the new Lloyds Banking Group retains and protects its hard working staff." |