Lloyds Banking Group admits £4.3bn of losses on Irish loans | Business | The Guardian
Lloyds Banking Group admits £4.3bn of losses on Irish loans Business The Guardian: "Bailed-out Lloyds Banking Group announced today that it will incur £4.3bn of losses on loans to Ireland, in the latest evidence that the problems inside the eurozone will have a knock-effect for Britain's banks.
Lloyds issued an impromptu trading update in which it also warned that it would take longer than it had expected to complete its previously announced withdrawal from the troubled country.
It admitted for the first time today the scale of the problems it faces in Ireland by revealing that 90% of the £5bn or so of loans it granted to property developers were impaired. Of the £6bn it lent for property investment, 54% is impaired.
After these £11bn of commercial real estate loans, the rest of its £26.7bn of loans in Ireland are split evenly between corporate customers and retail customers.
The bank's shares fell 4% to 66p after the surprise trading update confirmed fears that the Irish situation would haunt British banks. Royal Bank of Scotland, also bailed-out by the taxpayer, is the other big UK bank with large exposure to Ireland. Its shares also suffered, falling 5.5% to 37.9p.
On the day that ratings agency Moody's downgraded Ireland, Lloyds said that there had been a 'further significant deterioration in market conditions in the Republic of Ireland' since its last trading update at the start of November."
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Lloyds issued an impromptu trading update in which it also warned that it would take longer than it had expected to complete its previously announced withdrawal from the troubled country.
It admitted for the first time today the scale of the problems it faces in Ireland by revealing that 90% of the £5bn or so of loans it granted to property developers were impaired. Of the £6bn it lent for property investment, 54% is impaired.
After these £11bn of commercial real estate loans, the rest of its £26.7bn of loans in Ireland are split evenly between corporate customers and retail customers.
The bank's shares fell 4% to 66p after the surprise trading update confirmed fears that the Irish situation would haunt British banks. Royal Bank of Scotland, also bailed-out by the taxpayer, is the other big UK bank with large exposure to Ireland. Its shares also suffered, falling 5.5% to 37.9p.
On the day that ratings agency Moody's downgraded Ireland, Lloyds said that there had been a 'further significant deterioration in market conditions in the Republic of Ireland' since its last trading update at the start of November."
DISCLAIMER:Text may be subject to copyright.This blog does not claim copyright to any such text. Copyright remains with the original copyright holder.
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