Lloyds may seek shareholders' help

My Account
Logout

Create an Evening Standard Account

Use your social network

Save time by using your existing account to sign in to Evening Standard

We'll never share your information or post anything to your account without your permission

Welcome! Sign in here

Use your social network

Save time by using your existing account to sign in to Evening Standard

We'll never share your information or post anything to your account without your permission

Forgot your password ?

Registration

* indicates fields that are mandatory

Email *

Password *

Confirm Password *

First name *

Surname *

Postcode *

Country *

Mobile phone number

Username *

Gender *

Year of birth *

When you sign up...

You will have access to all our online competitions, discounted offers and can post comments on our site.

You will also receive The Weekender newsletter sent every Thursday - it’s full of fantastic offers and ideas for the weekend. You can update your email preferences in your account page when you log in.

Other newsletters and emails

Homes & Property Newsletter - Yes I want to receive the weekly email with all the latest news on property in the capital

Occasionally we would also like to send you relevant emails detailing specific offers either from ourselves or carefully selected partners. If you would prefer not to receive these then please tick the appropriate boxes below. We will never pass on your details.

I do not want to receive additional offers and information from the Evening Standard

I do not want to receive additional offers and information sent by Evening Standard on behalf of carefully selected partners

Terms and Conditions

* I have read, understood and agree to be bound by the terms and conditions of Evening Standard

Registration

Mail Sent for Registration Confirmation.

A confirmation email has been sent. Please activate your account by clicking on the activation link sent in your mail box.

The bank - which is 43% state-owned - is considering the move to avoid the £16 billion cost of placing billions in toxic debts into a taxpayer-backed insurance scheme, the Sunday Times reports.

Lloyds reported a £4 billion loss for the first half of 2009 last week after taking a £13.4 billion charge for bad debts - mostly from HBOS, the ailing bank it rescued last autumn.

The group agreed to put £260 billion worth of loans into the Asset Protection Scheme (APS) in March but could significantly reduce its participation if the Government agrees, the report said.

As well as the cost of the APS, Lloyds is also said to be concerned at the increase in the Government stake to more than 60% which would come with the move.

Under the APS, Lloyds would be responsible for a first loss of up to £25 billion on the insured assets as well as 10% of further writedowns.

Analysts estimate the bank would have to raise between £10 billion and £15 billion from shareholders to shore up its finances if it pulled out of the scheme altogether.

But Lloyds also said last week it expected its impairment charges on bad loans to have peaked in the first half of the year.

This led some investors to question the strategy of paying huge fees to the Government to insure against further losses, the newspaper adds.

Some hedge funds are even said to be threatening to vote against the bank's move into the scheme, which must be approved by shareholders.