Lloyds Banking Group PLC Completion of MBNA Acquisition
June 01 2017 - 2:30AM
Dow Jones News
TIDMLLOY
RNS Number : 7691G
Lloyds Banking Group PLC
01 June 2017
01 June 2017
LLOYDS BANKING GROUP ANNOUNCES COMPLETION OF ACQUISITION OF MBNA
LTD FROM BANK OF AMERICA
Lloyds Banking Group ('the Group') today announces that it has
completed the acquisition of MBNA Ltd (MBNA), a UK consumer credit
card business, from FIA Jersey Holdings Limited, a wholly owned
subsidiary of Bank of America, following receipt of regulatory and
competition approval.
The transaction is consistent with the Group's stated strategic
ambitions of growing in Consumer Finance and will enable the Group
to enhance its position and offering within the UK prime credit
card market through the MBNA brand. The purchase terms are in line
with those previously disclosed and the purchase is expected to
deliver strong financial returns including:
-- an underlying Return on Investment that exceeds Cost of
Equity in the first full year and increases to c.17% in the second
full year following the acquisition
-- c.3% and c.5% statutory EPS accretion in the first and second
full years following the acquisition
Given the transaction will enhance Group net interest margin by
c.10bps per annum there will be a c.5bps benefit to net interest
margin in 2017. The transaction has been funded through organic
capital generation with c.80 basis points of Common Equity Tier 1
(CET1) capital retained on the Group's balance sheet since the end
of 2016.
Commenting on the transaction, António Horta-Osório, Group Chief
Executive, said:
"The acquisition, which is funded through strong internal
capital generation, increases our participation in the UK prime
credit card market, where we were underrepresented, and strengthens
our position as a UK focused retail and commercial bank. The MBNA
brand and portfolio are a good fit with our existing card business
and we will focus on providing its customers with excellent service
and value. Our proven integration capabilities and low cost to
income ratio will deliver significant synergies and value to our
shareholders."
- END -
UBS and AHP Partners are acting as financial advisers for Lloyds
Banking Group on this transaction.
For further information:
Investor Relations
Douglas Radcliffe +44 (0) 20 7356 1571
Group Investor Relations Director
Email: douglas.radcliffe@finance.lloydsbanking.com
Corporate Affairs
Ross Keany +44 (0) 131 655 5354
Director of Communications
Email: ross.keany@lloydsbanking.com
FORWARD LOOKING STATEMENTS
This document contains certain forward looking statements with
respect to the business, strategy and plans of Lloyds Banking Group
and its current goals and expectations relating to its future
financial condition and performance. Statements that are not
historical facts, including statements about Lloyds Banking Group's
or its directors' and/or management's beliefs and expectations, are
forward looking statements. By their nature, forward looking
statements involve risk and uncertainty because they relate to
events and depend upon circumstances that will or may occur in the
future. Factors that could cause actual business, strategy, plans
and/or results (including but not limited to the payment of
dividends) to differ materially from the plans, objectives,
expectations, estimates and intentions expressed in such forward
looking statements made by the Group or on its behalf include, but
are not limited to: general economic and business conditions in the
UK and internationally; market related trends and developments;
fluctuations in interest rates (including low or negative rates),
exchange rates, stock markets and currencies; the ability to access
sufficient sources of capital, liquidity and funding when required;
changes to the Group's credit ratings; the ability to derive cost
savings and other benefits including, but without limitation as a
result of any acquisitions, disposals and other strategic
transactions; changing customer behaviour including consumer
spending, saving and borrowing habits; changes to borrower or
counterparty credit quality; instability in the global financial
markets, including Eurozone instability, the exit by the UK from
the European Union (EU) and the potential for one or more other
countries to exit the EU or the Eurozone and the impact of any
sovereign credit rating downgrade or other sovereign financial
issues; technological changes and risks to cyber security; natural,
pandemic and other disasters, adverse weather and similar
contingencies outside the Group's control; inadequate or failed
internal or external processes or systems; acts of war, other acts
of hostility, terrorist acts and responses to those acts,
geopolitical, pandemic or other such events; changes in laws,
regulations, accounting standards or taxation, including as a
result of the exit by the UK from the EU, or a further possible
referendum on Scottish independence; changes to regulatory capital
or liquidity requirements and similar contingencies outside the
Group's control; the policies, decisions and actions of
governmental or regulatory authorities or courts in the UK, the EU,
the US or elsewhere including the implementation and interpretation
of key legislation and regulation; the ability to attract and
retain senior management and other employees; requirements or
limitations on the Group as a result of HM Treasury's investment in
the Group; actions or omissions by the Group's directors,
management or employees including industrial action; changes to the
Group's post-retirement defined benefit scheme obligations; the
extent of any future impairment charges or write-downs caused by,
but not limited to, depressed asset valuations, market disruptions
and illiquid markets; the value and effectiveness of any credit
protection purchased by the Group; the inability to hedge certain
risks economically; the adequacy of loss reserves; the actions of
competitors, including non-bank financial services, lending
companies and digital innovators and disruptive technologies; and
exposure to regulatory or competition scrutiny, legal, regulatory
or competition proceedings, investigations or complaints. Please
refer to the latest Annual Report on Form 20-F filed with the US
Securities and Exchange Commission for a discussion of certain
factors together with examples of forward looking statements.
Except as required by any applicable law or regulation, the forward
looking statements contained in this document are made as of
today's date, and Lloyds Banking Group expressly disclaims any
obligation or undertaking to release publicly any updates or
revisions to any forward looking statements. The information,
statements and opinions contained in this document do not
constitute a public offer under any applicable law or an offer to
sell any securities or financial instruments or any advice or
recommendation with respect to such securities or financial
instruments.
UBS Limited is authorised by the Prudential Regulation Authority
and regulated by the Financial Conduct Authority and the Prudential
Regulation Authority in the United Kingdom. UBS Limited is acting
as financial adviser to Lloyds Banking Group and no one else for
the purpose of the transaction described herein and will not be
responsible to anyone other than Lloyds Banking Group for providing
the protections offered to clients of UBS Limited nor for providing
advice in relation to such transaction.
This information is provided by RNS
The company news service from the London Stock Exchange
END
ACQABMFTMBJJBRR
(END) Dow Jones Newswires
June 01, 2017 02:15 ET (06:15 GMT)
Copyright (c) 2017 Dow Jones & Company, Inc.
Lloyds Banking (NYSE:LYG)
Historical Stock Chart
From Mar 2024 to Apr 2024
Lloyds Banking (NYSE:LYG)
Historical Stock Chart
From Apr 2023 to Apr 2024