Towering impairment charges of £0.4 billion (€0.5 billion) have
seen Lloyds Banking Group’s (LBG) asset finance division report a
loss totalling £250 million for the first half of 2009,
contributing to the bank’s overall £4 billion cash haemorrhage.
This result represents a fall of £292 million from the £42
million profit reported for the first half of 2008, a figure which
includes HBOS’ results as if it had been acquired at the start of
that year.
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According to LBG, the rise in impairments was in large part due
to the performance of the group’s consumer finance business.
Despite improvement of margins across the asset finance
division, income was down 13 percent to £890 million. Nevertheless,
new business decrease also led to an 11 percent drop in operating
expenses to £734 million.
While LBG continues to assemble its 370,000 vehicle fleet
colossus Lex Autolease from parts thrown together by the buyout of
HBOS at the start of the year, its interim statement confirmed that
“new business through the Bank of Scotland Dealer, Marine Finance,
Vendor & Intermediary and Specialist Asset Finance businesses
will cease”.
Fred Crawley
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