Lloyds boss Antonio Horta-Osorio in plea for branch sales reprieve

By Simon Watkins for The Mail on Sunday

Lloyds boss Antonio Horta-Osorio is to meet the head of the Independent Commission on Banking next month in a bid to convince him not to impose a draconian sell-off plan on the bank.

All Britain's bank chief executives are set to meet Sir John Vickers in July in what will be their final direct meetings before the ICB delivers its report on September 12.

Most of the banks are now resigned to the ICB recommending ring-fencing to keep retail and investment banking separate.

Lloyds Banking Group chief Antonio Horta Osorio

Problems: Lloyds Banking Group has serious issues to face with the ICB

But Lloyds Banking Group has serious outstanding issues to face with the ICB, which called in its interim report for the bank to make substantial branch disposals to reduce its market dominance and improve competition.

Portuguese-born Horta- Osorio, who took over as chief executive in February, is desperate to avoid being forced to sell off more branches than the 632 already put up for sale by the bank to meet EU competition concerns after its Government bailout.

Horta-Osorio has won influential support from the Association of British Insurers, which is expected to write to the ICB this week saying that any further forced disposals would be unjustified. The ABI represents the big institutional investors that own most of the 67 per cent of Lloyds not owned by the Treasury.


On Thursday, Horta-Osorio will announce the outcome of his strategic review of Lloyds.

Sources describe the review as 'evolution not revolution'. Horta-Osorio is likely to announce plans for Lloyds to exit almost completely from its already-negligible overseas operations.

It has business in 30 countries outside Britain, but these are little more than branch operations and represent a tiny part of the group's revenues.

All the existing major brands in Lloyds will be retained, including Scottish Widows, which has been the subject of constant sell-off rumours in recent years.

Horta- Osorio's strategy will focus on greater crossselling of the brands, with Scottish Widows policies increasingly being sold through Halifax or Lloyds branches.

Analysts are keen to see big cost reductions. It is thought that £1 billion in savings have been identified, leading to speculation that 15,000 jobs could be cut as a result of the review.

Lloyds has already shed 28,000 staff since its takeover of HBOS.