Analysts suggest that todays results confirm that 'Lloyd's is becoming increasingly dependent on cost-cutting to meet profit expectations'.

If this is the case, then doesn't that just strengthen the case for LLoyds to merge/be taken over by a European/US partner looking for a blue chip UK consumer finance bank ?

Whilst the Divi yield is good and provides downside protection - there aren't too many pundits who believe that the current divi is in danger, though they're disappointed its not rising, Lloyds will struggle along without another deal.

IMHO they're too poor relation to takeover the likes of Alliance/Leicester, Bradford/Bingley or Northern Rock, and that concentration on the UK finance market would likely scare the market witless.

Surely not too long before (or at least the rumours of) a tie up with Santander, Bank of America, Citibank, et al. ?

What are the thoughts of others?

Hi Halifax - yes still hold LLOY (thankfully only a fairly modest 3000 shares, at about 60% notional loss at present). Rightly or wrongly I believe that the underlying LLOY business is basically very sound and the Halifax bit of HBOS should be OK - but the scale of the BOS debacle is almost beyond comprehension. I have no idea where it will go short term, but I am not a day trader. My poorest performer, but I hope to see it recover fairly strongly in next two/three years.

its actually halifax with its property thats screwed up everything......and buying these stoopid property companies at peak of boom even in 2008! i imagine brown etc told hbos to buy for his own political Agenda. brown and mandelson know many of lloy, hbos, rbs at top for many years...........check out that buffoon james crosby who was in fsa at same time head of hbos. everything crosby touches turns to shit......and he's an ugly baldy old git

halifax - time you realised that marni is incapable of being other than boorishly abusive especially when her bottle is nearly empty