Lloyds to sell stake in investment unit

Lloyds bank plans to sell 20 per cent of its holding in investment manager St James's Place. Source: AAP

BRITAIN'S state-rescued Lloyds bank says it will seek to sell 20 per cent of its holding in investment manager St James's Place, as part of ongoing restructuring efforts.

"Lloyds Banking Group plc announces today its intention to sell an anticipated minimum 102 million ordinary shares in St James's Place plc, representing approximately 20 per cent of the company's existing issued ordinary share capital," it said in a brief statement.

"The placing reflects Lloyds' strategy to simplify the group and focus on its core customer franchise."

Earlier this month, Lloyds had posted annual losses of STG1.43 billion ($A2.10 billion), hit by huge insurance mis-selling compensation, but it awarded its boss a bonus linked to an eventual sale of the government's stake.

The loss after tax was almost half the STG2.79 billion shortfall it suffered in 2011.

The bank is 39 per cent owned by the British government after a state bailout following the 2008 global financial crisis.

Lloyds also said that chief executive Antonio Horta-Osorio would receive a 2012 performance bonus of STG1.485 million, deferred in shares until 2018.

However, at Horta-Osorio's request, the bonus will be paid only if the British government sells at least a third of its stake above 61 pence - the average price it paid during the bank's bailout - within the next five years.

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Lloyds posts loss but awards bonuses

Britain's state-rescued Lloyds bank posted a 2012 net loss of $A2.13 billion. Source: AAP

BRITAIN'S state-rescued Lloyds bank on Friday posted a 2012 net loss of STG1.427 billion ($A2.13 billion), rocked by huge compensation for insurance mis-selling, but awarded its boss and staff a large round of bonuses.

The loss after taxation, equivalent to $2.165 billion or 1.657 billion euros, compared with a shortfall of 2.787 billion in 2011, Lloyds said in a statement.

Pre-tax losses were meanwhile slashed to 570 million, from 3.542 billion last time around.

However in the fourth quarter, LBG set aside another 1.5 billion to cover compensation for mis-selling payment protection insurance, taking its annual provision to a vast 3.575 billion. The total bill now stands at 6.775 billion.

Lloyds added that it has also set aside 400 million to compensate clients who were mis-sold interest rate hedging products.

Separately, the lender announced that chief executive Antonio Horta-Osorio would receive a 2012 performance bonus of 1.485 million that will be deferred until 2018 and dependent on its share price level.

Lloyds added that its staff would also share a total bonus pot of 365 million despite the fresh annual losses. That was three percent lower than the previous year.

The bank is 39-percent owned by the British taxpayer after a vast bailout at the height of the global financial crisis.

"The substantial progress we made in 2012 means that we are now ahead of our plan to transform the group, and this was reflected in our stronger underlying financial performance in the year," said Horta-Osorio in the results statement.

"Since setting out our strategy in June 2011, we have significantly strengthened the balance sheet, and substantially improved efficiency and focus, while continuing to work through legacy issues.

"We are investing in our simple, lower-risk, customer-focused UK retail and commercial banking model, and in value-for-money products and better capabilities to continue to support UK households, businesses and communities.

AF

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