Lloyds ends exclusivity agreement with Co-op

Lloyds Banking Group has ended its exclusivity agreement with the Co-operative Group over the sale of its 632 bank branches.

Co-op entered into exclusive talks with the state-backed bank over the sale in December although doubts over the deal surfaced when the Co-op admitted to there being “economic and regulatory” hurdles in the way of the sale.

Co-op is still LBG’s preferred bidder for the branches, known as project Verde, but the talks are no longer exclusive.

Earlier this month, NBNK Investments, chaired by former Lloyds chairman Peter Levene, submitted a revised proposal for the branches. NBNK had previously lost out to Co-op in the race for the branches.

LBG is forced to sell the branches in return for being bailed out by the Government and has until November 2013 to do this.

A statement published today says: “The Group continues to have productive and meaningful discussions with the Co-operative Group, its preferred buyer for the Verde business.

“However, LBG is no longer holding these discussions under an exclusivity agreement. Given the renewed interest in the Verde business shown by NBNK, LBG will now consider detailed discussions with other parties but only once LBG is satisfied that any proposal is likely to achieve the appropriate regulatory clearances and offers greater value and/or certainty to LBG shareholders against its alternative option of an Initial Public Offering.”