Britain’s taxpayer-rescued banks – including Lloyds, Northern Rock and RBS – moved back into profit prompting speculation of an eventual sell-off to net a quick windfall for the Treasury.
UKFI, the agency set up to rescue the banks from their bad investments, showed a notional paper profit of £7.4 billion according to financial press estimates.
Lloyds Banking Group moved back into profit in the first six months of the year, reversing a £4 billion loss to a £1.6 billion profit as bad debts halved.
This was double what had been forecast and reflected a large improvement in its profit margins as the bank made more money from customers and a halving in charges for bad loans, down to £6.5 billion from £13.4 billion a year ago.
Overall loans and advances to customers fell to £612 billion from £627 billion the same time last year.
Taxpayers own 41 per cent of Lloyds shares following the October 2008 bailout. Among the other nationalised and rescued banks, parts of Northern Rock returned to profit while Royal Bank of Scotland also moved into the black.
Some 16,000 jobs have been axed as a result of the HBOS takeover by Lloyds which the Labour Government rushed through.
City minister Mark Hoban ruled out any imminent sale of the taxpayers’ stake in the banks and that selling them off is unlikely in the next 12 to 18 months pending the report by Government’s commission possibly breaking up the banks.
