any one got a feelling in their water how far LLoyds will go looking to to buy but just dont know when they are low enough

Why do people think it will go lower ie 147p or lower does not make sense to me.


Edit..Hbos now following.

Cynic please explain why it is a good idea to buy the largest mortgage lender by market share in front of the imminent collapse of the housing market.

because even if it collapses, people will still need and need to pay their mortgages and in due course, house prices will start to rise again ..... there was absolutely no way LLOY would have been permitted to buy Halifax (HBOS) in "normal" circumstances

Concerns that the merger between HBOS and Lloyds TSB may collapse are hitting the shares of the two merger partners. The government has agreed to underwrite huge share issues from both banks and at current prices looks like it will be left with huge stakes in the pair, making a full-on nationalisation a possibility.

why should it collapse? ..... shareholders of HBOS may well not like the price they get, but the other alternative is zilch

I think that holders that bought Lloyds for dividend and cautious management will string the board up if they go ahead.

Why? My understanding is there will be no dividend for any banks who have taken this deal until 2010 So they're getting no dividend anyway I agree with cynic and hold LLOY so do the govt who will want this deal to go through.

Just had another look at the deal. The pref shares are callable after 5 years & therefore no dividend will be paid at least until then to Ordy holders. The Government agree to pay 173.3p for each Lloy share subject to existing shareholder claw back at 173.3p. If investors claw back nil, then Gov will end up with 43.5% of enlarged group. Imho the Gov probably hoped that sp would go above clawback price so its overall take up would be lower. Like other ordy holders, this is just dead money for 5 years without a dividend. After the Gov have secured an income on the prefs at 12% so they have got that in the can. Cynic, I cannot see how the fluctuation in the sps effect the price paid for HBOS, since it is an all share offer at .605 for every 1 HBOS. I wouldn't be surprised to see the sp rally to above the claw back price nearer to the time of the effective dates. Unless you feel that the ultimate plan is to nationalise this bank (which I don't), although I do not blame investors particularly with this shady lot, I think the deal has no choice but to go ahead. If the deal does not go ahead I think the Government would then make the appropriate move which would not be in shareholders interests. Once we can get a new Government the clunking fist may be removed.

Gus the difference between the share prices will either mean better or worse value if you buy HBOS ie 100 HBOS @ sp 80p = 80
100 HBOS = 60.5 LLOY @ sp 149=90.145

because i am being even more stupid than usual, though a falling sp means that the rights issue becomes ever less attractive

absolutely, so god forbid the there would be any manipulation but, it would not surprise me to see a rally above the clawback price. Will be interesting to see how it turns out.

LONDON (Reuters) - Some banks are urging the government to lift a ban on dividend payments imposed as part of its 37 billion pound bail-out of the crisis-hit sector, The Financial Times reported on Wednesday.

The FT gave no source for its information.

Royal Bank of Scotland, HBOS and Lloyds TSB -- the three lenders participating in the state rescue -- have all seen their share prices drop as a result of the dividend condition, the newspaper said.

All three banks are currently trading below the price at which the government has offered to buy the shares, meaning private investors are unlikely to take up the stock.

That would leave the government with the highest possible stake in each bank -- maximising the risk to taxpayers. A reinstatement of dividends could make the shares more appealing to non-government buyers.

RBS and HBOS declined to comment, while Lloyds could not be reached for comment.

when does the Gov actually purchase the shares.

Anybody know?

I only brought lloy for a relative stable company and the dividend, I won't be taking up my new shares, and would like to see lloy walk away from this deal. If lloy did pull out and raise the money via a rights issue I would take up my full allowance, as I'm sure other private investors would.

It "probably" depends on your investment viewpoint ( and LLOY execs don't own the share-market).
If you bought LLOY at 4+ some while ago as a "safe-haven" and decent dividend, this fiasco is a disaster ONLY if you Sell. (er, IMHO).

If you bought recently as a speculator this is also a disaster - and many folks are bailing-out fearing ti will get worse.

Institutions are "probably" bailing-out as they need a cash-stock for their payments ( eg Pensions).
So they are looking elsewhere. Meanwhile the Gov stance on the payment of dividends is upsetting LLOY ( and others) as they like the Exec-lunches given by the pension industry - I'm guessing.
I suspect there will be a fudge and where any Bank is doing "better" ( not difficult, eh?) - they will be allowed to pay modest dividends, maybe 5% provided the Gov. "Preference shares" get the lion's share (no pun).

Whatever one thinks of GB - he has "...with one leap catapulted himself into the No.1 Finance World Rescuer . . . . a pretty difficult thing to do, made possibl;e only by these unusual events.

Personally, I wouldn't trust most MP's to park my car ( the clutch is a bit sharp), yet of the whole of Parliament, Vince Cable(lib) and GB are the only ones with sufficient Gravitas to make anything of this mayhem. Although folk need to watch GB keeps taking the right medicine.

The US was the root cause of the problem, fueled by the "free-ride" attitude of the Bush administration (can I say thet?) - and quite reasonably they hoped it woul;d keep going so they'd be re-elected. Unfortunately it fell short by six-months and they had no Plan ( remember IRAQ? No "peace-plan" was in place.).

LLOY appears to be rising, off these dire Lows - can it be that LLOY share is only worth a little more than an ice-ceream?
Dilution may be the ovbious reason and the Government "pref.shares" which are Dilution-in-waiting.

We do need International agreement, but more to the point we need International Punishment for circumventing so-called "Rules" - so we should be creating an Interpol where boundaries are non-existant. Perhaps this should extend to terrorism on an international scale, but excluding crimes that are contained in a country.

I agree with you, they would be able to raise the additional funds from shareholders. The Gov have bungled as usual by not letting the Ordy receive a dividend. Thus, income funds have been ditching their stock. If they reduce the pref percentage and allow a dividend on the Ordy, (some of which will be held by the Gov, the claw back will increase since the sp is more likely to rise above the clawback price. It is not as if Lloy were in the weaker positions of RBS and HBOS.

Bought a fw today @155p not sure if I have done the right thing but they seem cheap to me.

I hold a few of these and pay tax - so I'm in by choice and by force . . . . shouldn't the Taxpayer-Loan be paid back before dividends start to roll?
Surely that's only reasonable - if say they were borrowing from the Unlimited Bank of World . . .they'd be insisting that profits came to them first.

For 5-years, IMHO, the Banking Sector has been paying dividends it had no business to . . . for most of them were holding enormous losses, but they pretended these were valuable pieces of paper - I sure wish they offered to buy some of my "Nitefly" loan-stock, currently offering 40% interest after two years. Quipple-A-rated ( that's 5-A's) by the Up-Town-Girlie-Bank of Cleavage, whose Logo is a Stalion rampant, mounted by a semi naked lass with flowing skirt, in full cry, carrying aloft a flaming torch.

-Those ads I'd like to see.

LLOY at 1.55 - sounds cheap to me, but large Buyers are not convinced. They need dividends to pay their cash-calls and don't want to sell shares to raise the cash-equivalent. They may think the "preference shares" are a better yield......anyone?

If you'd like to listen to Eric Daniels, Lloyds TSB's CEO, telling interested parties what is going on, then dial

0800 032 9687

When asked for a 'Pass Code', press 49241546 and then #

One thing he mentions, is how he and his board at the bank are pushing to have the dividend payments unfrozen.

After listening to it, then I did think it was strange to read the following today:

Two 'Top Ten' Lloyds Investors shrug off dividend row

He obviously hasn't got these major investors on board with that idea then, has he?

Have I discovered a conspiracy?

'RBS': AFX News says "LONDON, Oct 20 (Reuters) - Standard Life Investments, one of the largest investors in Royal Bank of Scotland and HBOS, said on Monday it is likely to increase its stake in both banks as part of a UK government recapitalisation plan...."

And the result?

On this quite positive news, RBS are up 23.18% today to 84.5p

However, this news doesn't get a smidgin' of a mention in the HBOS News slot. Nothin'. Nil. Zilch.

And the result of that?

With no positve news to support the share price, HBOS slides 1.10p or 1.37% down to 78.9p

By the way, Lloyds TSB have agreed to buy HBOS for 0.605 x the LLOY price. Since the latter currently closed at 173.50, up 14.7p or 9.26% then this means that the agreed HBOS buying price is 173.5 x 0.605 = 104.9p or a massive 26p higher than today's HBOS closing price of 78.9p.

Hmmm? As I originally asked, 'Have I discovered some kind of a conspiracy?' then....

Q2. "Should this deal even go ahead?"

Q3. "HBOS seems so unpopular and unloved. Shouldn't it just be nationalised and the bits sold off?"

Q4. "If not Q3. above, since the value now works out at a much lower factor of 0.455 x LLOY share price, shouldn't the price for HBOS be re-negotiated once again?"