LLOYDS Banking Group chairman Lord Blackwell has said victims of the fraud committed by former HBOS Reading staff will be compensated in weeks rather than months.
He was speaking at Lloyds’ general meeting in Edinburgh where chief executive Antonio Horta-Osorio said the Government should make a profit of at least £500m on the bailout it provided after Lloyds acquired HBOS in 2008.
The Government is expected to sell off its remaining holding of 0.25 per cent of Lloyds shares in coming days allowing the bank to return to full private ownership.
“We take great pride in the fact that the government has already received more than its original investment,” Mr Horta-Osorio said.
He added: “It’s easy to lose sight of the fact that just six years ago this was a bank in crisis.”
Mr Horta-Osorio said Lloyds had been turned around from the time when it acquired £200 billion of “toxic assets” from the takeover of HBOS and had a “significant” PPI problem.
“We are now a strong, safe and UK-focused bank,” he observed.
However, the problems Lloyds inherited after the HBOS takeover were in focus at yesterday’s meeting following the revelation this week that TV celebrity Noel Edmonds is seeking £50 million compensation from the group.
Mr Edmonds claims one convicted former HBOS employee, Mark Dobson, helped destroy his former business Unique Group .
Lloyds has set aside £100m to compensate victims of the fraud, which involved a £245m loan scam that destroyed several businesses. The case dates back to the time before Lloyds took over the HBOS business
Lord Blackwell told the general meeting the final amount paid will depend on the outcome of the claims process.
Noting Lloyds was determined victims of the fraud should be fairly swiftly and appropriately compensated, Lord Blackwell said: “Quickly means weeks rather than months”.
One investor complained that Lloyds had appointed Lady Dobbs to investigate its conduct in relation to the fraud but proposed her findings should be passed to regulators rather than published more widely. She said this amounted to Lloyds investigating itself.
Lord Blackwell responded: “A High Court judge is as independent as you can get.”
He also defended the bank’s controversial branch closure programme. The policy is expected to result in 24 Bank of Scotland branches closing between July and October.
Lord Blackwell said branches remained an important part of Lloyds’ service. The group could not keep outlets open where usage had fallen to unsustainably low levels in response to consumers choosing to do their banking online.
In response to suggestions from a shareholder from Sussex that Lloyds should hold its general meetings in England, Lord Blackwell noted it had been obliged to have them in Scotland under the deal to acquire HBOS. The group has no plans to get out of that obligation.
“We’re proud of our presence in Scotland which is a very important part of our group,” said Lord Blackwell. He noted the group has thousands of employees in its operation in Scotland, which include the Scottish Widows life and pensions business.
Asked if Lloyds might form a shareholder committee to help win support for policies in areas such as executive pay., Lord Blackwell was not convinced of the benefit having another body to advise the board.
The Government has cut its holding in Lloyds from 43 per cent in 2008 through share sales and received dividends.
Why are you making commenting on The Herald only available to subscribers?
It should have been a safe space for informed debate, somewhere for readers to discuss issues around the biggest stories of the day, but all too often the below the line comments on most websites have become bogged down by off-topic discussions and abuse.
heraldscotland.com is tackling this problem by allowing only subscribers to comment.
We are doing this to improve the experience for our loyal readers and we believe it will reduce the ability of trolls and troublemakers, who occasionally find their way onto our site, to abuse our journalists and readers. We also hope it will help the comments section fulfil its promise as a part of Scotland's conversation with itself.
We are lucky at The Herald. We are read by an informed, educated readership who can add their knowledge and insights to our stories.
That is invaluable.
We are making the subscriber-only change to support our valued readers, who tell us they don't want the site cluttered up with irrelevant comments, untruths and abuse.
In the past, the journalist’s job was to collect and distribute information to the audience. Technology means that readers can shape a discussion. We look forward to hearing from you on heraldscotland.com
Comments & Moderation
Readers’ comments: You are personally liable for the content of any comments you upload to this website, so please act responsibly. We do not pre-moderate or monitor readers’ comments appearing on our websites, but we do post-moderate in response to complaints we receive or otherwise when a potential problem comes to our attention. You can make a complaint by using the ‘report this post’ link . We may then apply our discretion under the user terms to amend or delete comments.
Post moderation is undertaken full-time 9am-6pm on weekdays, and on a part-time basis outwith those hours.
Read the rules here