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

IS THIS THE BOTTOM.

can not see them wanting to expand much further in UK apart from taking advantage in cherry picking NRK business and such like. They have built up a good high wealth client business but, the outlook for UK generally is not inspiring. There is not a credit crunch if the business is of good quality. Call it a credit crunch if there is little or no security but this is what all the mess is about after all. It will take some time to sort out but the good old ways of doing business will return - they have to.

Outlook not good for unemployment which will impact on credit card business. However, lloy did sell of the lower end Marbles card business a couple of years ago and probably has relatively good quality accounts. imho

Not too sure how lloy stands on the compensation front re insurance protection policies.

How about their exposure to the property bubble with C & G ?

I guess that this exposure has been discounted in the sp, but it remains a concern if the UK economy performs worse than expected. I read somewhere that the C & G mortgage book has benefited from more conservative lending criteria than others, but not sure how true this is.

Don't think we are out of the woods yet, and would expect plenty more nasty news in the bank sector.

Still waiting to but lloy and rbs on weakness.

I agree spitfire so if you were on the LLOY board would you be contemplating a major acquisition never mind in euroland? Look what happened to the RBS sp after they bought ABN/AMRO. Does this story about Deutsche Postbank have any substance or is it just journos in search of a story?

todays sp tells the story, the City always anticipate what will happen.

would think the board would like to buy cheap assets, but why buy now when prices could weaken further.

I wonder if the real story is this -
"...We were prudent during the cheap-money period . . . . and we have cash waiting to buy into a European operation..."
- This would be a good way to spread the business and make them attractive to savers/businesses who regularly visit/do business in Euroland. All I know is they have interest in Cheltenham and Gloucester (for Mortgages) . . . and Scottish Widows (for life insurance)......but am unaware of direct European operation.

I thought the name Deutsche Postbank came from LLOY - not from journos creating a story.

I just wonder if LLOY won't then use this takeover as an excuse to ask shareholders for money....ah - - - who knows?

hangon on read post 32 source DTel.... no comment from LLOY...... does any bank want to manage 11000 branches in Germany? Sounds like a major headache to me!

You need to be a genius to forcast the bottom but in a large scale take over a reasonably low price is surely the best to be hoped for. The finacial crisis occurred in the middle of t/over battle with Barclays and RBS had time to amend their bid which would have been common sense but Fred didn't thus saddling the shareholders with execesive debt.

Lloyds long the butt of the market have plodded on with their old fashioned banking methods, bought 2 top line coys C&G, S/Widows. decided to concentrate on retail and sell unwanted, keep faith with share holders [divs] How very old fashioned, if they win Deutcher Post what will the market make of them then

Congatulations Mr Daniels, meantime friends where can I find some lolly to buy more.

2 questions

Anyone think they'll have ro raise money ?

Anyone think they will cut the divi ?

If the answer to both is no then with a 10% divi these are looking as cheap as chips.

I'm currently out of them but looking to buy back in again.

If they raise money I would think it would be to expand business in weak sector.

Divi could be cut if the UK market weakens further and house prices really start to fall, but even if they were cut 50% then 5% isn't bad.

I'm looking to make a small purchase soon, but still expect sp to fall further because of the exposure to the UK. My plan is to buy in small parcels, so that at the end of this downturn I should have a decent holding.

Godd Luck.............

I suspect they will not cut the divi (precedent a few years ago). Whilst they have some exposure to US related credit issues, these appear much smaller than others. UK mortgage book will suffer in present climate, but provisions made last few years should take care of that. I hold LLOY (on paper now about 15% down) but am seriously considering breaking one of my golden rules and averaging down. Will do so for certain if they hit 3. (Not sure where he got it from, but my late father once told me that rules were made for the obedience of fools and the guidance of wise men!)

Hadn't heard that one before, but sounds like a very wise old saying.

I did average down today at 325, with a target just below 300 for my next purchase. The yield at 325 is 11.5%, which is not bad, but imagine what the yield would be lower down.

If they go for Deutcher Post and succeed how will the market react? or try and fail?

Absolutely astonished how LLOY has been dragged down with the other banks, and like a few posters I partially averaged down (small purchase) at 3.50 - 3.60, but am certainly going in big (for me) if it drops under 3.

Whether or not LLOY can afford to maintain the divvy (and the forecasts say they can), I would personally suggest that it is cut, both to act as a cautious signal to the market, and to save potential later embarrasment should the balance sheet need shoring. Even halving the dividend leaves a fantastic current yield which should be that much easier to grow yr-on-yr.

See news below, the interesting part is the revised update from Panmure Gordon revising sp down to 350 from 410 but keeping the Hold rating.

Shares in Lloyds TSB Group Plc were lower midmorning following weekend press reports that the company is in talks to buy Allianz SE's Dresdner bank Unit.

At 9:28 a.m., Lloyds shares were down 6-3/4 pence at 320-3/4 pence, while the FTSE 100 was up 14.1 points at 5,634.9.

The deal may be worth about 6 billion pounds, said some reports. It may involve Lloyds swapping its Scottish Widows life-assurance business with Allianz in exchange for Dresdner's retail banking operation.

In a note, Panmure Gordon said such a deal offered few prospects for synergies and noted that talks were preliminary.

The broker has cut its target price on Lloyds to 350 pence, from 410, for reasons associated with a deteriorating UK macro outlook, rather than connected to the potential deal.

Retaining its 'hold' rating on Lloyds, Panmure said the focus was rising impairments, particularly on the 23 billion pounds of non-mortgage personal loans, noting that Lloyds has the highest market share in unsecured personal loans in the UK.

It also noted possible impairment to 20 billion pounds of property & construction loans, where it expects falling NAVs will lead to breached loan covenants putting pressure on developers and 30 billion pounds of loans to non-bank financials and others, and said it also expects impairments will rise on the 103 billion pounds mortgage book.

Panmure seem to have failed to realise that impairment or bad debt provisions are quite normal in the banking business, but then they are stockbrokers what do they know about banking. I am amazed at the way the stockmarket reacts to such guesstimates and ill informed opinion.

...from the very bearish Sandy Chen of Panmure
NHWe are cutting our forecasts and price targets to reflect the rapidly
deteriorating UK macro outlook. Talk of a German acquisition is preliminary,
with few prospects for synergies in our view.

We have revised our forecasts and price targets on LLOY to reflect the rapidly
deteriorating UK macro outlook.


NHThe focus, of course, is rising impairments, particularly on the 23bn of non-mortgage personal loans (LLOY has the highest market share in unsecured personal loans in the UK), the 20bn in property & construction loans (where
we expect falling NAVs will lead to breached loan covenants putting pressure on
developers) and the 30bn of loans to non-bank financials and others.

We also expect impairments will rise on the 103bn mortgage book.
None of the above is specific to LLOY; it is simply a reflection of the deteriorating UK macro trends. The last time that LLOY went through something like this, provisioning charges per RWA were 159bp in 1990, 252bp in 1991, 195bp in 1992 and 133bp in 1993; this time, we expect impairment charges per RWA will rise from 111bp in 2007 to 135bp in 2008 and 185bp in 2009.

NHHigher impairment charges are the main driver for our forecast downgrades. We cut our 2008 EPS from 46.7p to 41.7p, and our 2009 EPS from 49.1p to 32.6p. We have kept our assumption for dividends flat at 35.9p for now, but we note that with many of
LLOY.s peers having declared scrip interim dividends, we think that LLOY.s could cut its cash dividend by circa 30% and still look attractive as a (cash) dividend play.

We now expect that ROIC will fall from 13.2% in 2007 to 10.2% in 2008 and 8.5% in 2009.

PMi didnt know that -- largest unsecured lending book in UK
PMBit scary
NH
Our fundamental valuation models for banks are driven by the long-term prospects for
value-added margins. Despite the falls in ROIC, we still expect that LLOY.s ROICs will remain above its WACCs . i.e. we still expect that LLOY will create value over the next few years, something we do not expect for most of its peers. We do cut our share price target from 410p to 350p as a reflection of the lower value-added margins, but this still merits a Hold recommendation.

The ferocity of the recent fall (2008), shows that the Market is in Sell-mode - there being only falling, rather than a flattening-out ( of the sp grasph), as fears gradually subside. . . . . That's what we expect to see...isn't it?

LLOY,=a minute rise today, but I'm guessing we could see lower - HBOS is now lower than their Rights (DYOR), on "dividend reasons"; but my guess is it's foilks selling, expecting they can repurchase even lower.
Whowever said things were OK - no-one - so we are still in "falling prices".....that's likley to affect good and bad. Banks aren't top of our list of Best Buys, either.

High Street bank Lloyds TSB dishes out debit cards to children as young as 11

A High Street bank is giving children debit cards that could let them buy cigarettes, alcohol and porn videos over the internet.

Lloyds TSB is mailing the cards direct to children as young as 11 without telling their parents.

One 15-year-old boy used his to buy cheap cigarettes, Viagra and a fake adult ID online.

The father of the 15-year-old, who asked not to be named, believes Lloyds TSB is promoting illegal activity.

He said: 'I pointed out to them that by enabling children to purchase goods illegally over the internet, they were aiding and abetting a crime.

'Their response was that it was not down to them to monitor other people's children, and that teenagers who were brought up well would not abuse this facility.

MPs, consumer groups and parents have reacted with horror. LibDem Treasury spokesman Vince Cable said: 'It is deeply dispiriting. This is clearly motivated by short-term greed.'

In the past, children aged 11 to 15 who hold current accounts were restricted to debit cards that could be used only in cash machines or at bank branches.

The new cards could let them spend large sums on the web, potentially emptying their accounts, without their parents' knowledge.