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Lloyds Bank

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Lloyds TSB Bank Plc
Company typePublic limited company
IndustryFinancial services
Founded1995
Headquarters
London and Edinburgh
,
United Kingdom
Key people
Sir Victor Blank, Chairman
Eric Daniels, Chief Executive
ProductsBanking and Insurance
Number of employees
75,856
ParentLloyds Banking Group Plc
SubsidiariesLloyds TSB Insurance Services Ltd.
Websitewww.lloydstsb.com

Lloyds TSB Bank Plc is a retail bank in the United Kingdom. It was established in 1995 by the merger of Lloyds Bank, established in 1765 and traditionally considered one of the Big Four clearing banks, with the TSB Group which traces its origins to 1810.[1] Lloyds TSB has an extensive network of branches and cash machines across England and Wales and offers 24-hour telephone and online banking services. Today it has 16 million personal customers and small business accounts.[2] In Scotland, the bank operates as Lloyds TSB Scotland Plc. Following the acquisition of HBOS in 2008, the parent Lloyds TSB Group was renamed Lloyds Banking Group.[3]

History

Template:Details3 The bank can trace its roots back to 1765 with the foundation of Taylors and Lloyds in Birmingham. This private bank converted into a joint-stock company in 1865, becoming Lloyds Bank Limited in 1889. Most recently, in 1995, it acquired the demutualised Cheltenham and Gloucester Building Society. The first Trustee Savings Bank had been founded by the Revd. Henry Duncan of Ruthwell, Dumfriesshire in 1810, but it was not until 1985 that the TSB Group was incorporated under the Companies Act.[4] The creation of the modern bank was announced in 1995 and Lloyds TSB commenced trading in 1998, after the statutory process of integration had been completed.[5]

Lloyds' three Scottish branches were absorbed into TSB Scotland, which had remained separate to TSB Bank in England and Wales following consolidation. TSB Northern Ireland was disposed to Allied Irish Banks prior to merger in 1991 and, consequently, the bank does not have a presence in the province. TSB Channel Islands was integrated into TSB Bank in 1992. Lloyds Bank International merged into Lloyds Bank in 1986 as there was no longer any advantage in operating separately.[6]

The Scottish Widows Fund and Life Assurance Society demutualised and was subsequently acquired by the Group in 2000.

Services

The Halifax branch of Lloyds on George Square, built 1897.[7]

The bank offers a full range of banking and financial services. Lloyds TSB Offshore Limited, a wholly-owned subsidiary of Lloyds TSB Bank, operates branches in Jersey, Guernsey and the Isle of Man, while Lloyds TSB Bank (Gibraltar) Limited operates in Gibraltar; both trade as Lloyds TSB International.

Lloyds TSB is authorised and regulated by the Financial Services Authority, a member of the Financial Ombudsman Service, the Financial Services Compensation Scheme, the Association for Payment Clearing Services and of the British Bankers' Association; it subscribes to the Banking Code and Business Banking Code. The bank uses the following series of sorting codes:—

Range Note
30 to 39 former Lloyds branches
77-00 to 77-44
77-46 to 77-99		 former TSB branches
87 Lloyds TSB Scotland

Mortgages provided by Lloyds TSB Bank in England and Wales are administered by Cheltenham & Gloucester Plc; Cheltenham & Gloucester and Lloyds TSB Scotland are members of the Council of Mortgage Lenders. Conversely, C&G savings are actually investments in Lloyds TSB Bank. It was announced in 2009 that Lloyds TSB Scotland including additional branches of Lloyds TSB in England and Wales are to be divested by Lloyds Banking Group under the Trustee Savings Bank brand, together with branches (although not the name) of Cheltenham & Gloucester. The process could take up to four years to complete.[8]

The Lloyds TSB Foundation funds local, regional and national charities working to tackle disadvantage across England and Wales.[9] There are separate Foundations covering Scotland, Northern Ireland and the Channel Islands.

Controversies

The Teddington branch of Lloyds in Middlesex, designed by Albert Randall Wells in 1929.[10]

Mistreatment of customers

The methods used by a high-profile Lloyds TSB service (The Collections Dept., based in Southend-on-Sea, Essex, UK), has been strongly criticised by consumer groups and others,[11] as have manoeuvres allegedly designed to take advantage of legal loopholes to avoid repaying charges levied against its clients.[12] Lloyds has also been accused of religious discrimination in connection with its overdraft charges.[13]

Senior management team

There has been personal controversy surrounding the chairman of Lloyds TSB, Sir Victor Blank, following the involvement of lawyers in a dispute with a senior Oxford academic,[14] as well as other concerns about the Chief Executive Officer of the bank, Eric Daniels.[15]

Employee relations

The Lloyds Banking Group, which encompasses Lloyds TSB, has been repeatedly criticised for its failure to protect jobs.[16]

Mis-selling of 'precipice' bonds

In 2003, Lloyds TSB was fined £100,000,000 for its part in mis-selling high risk investment bonds.[17]

Tax evasion and money laundering

In 2009, it was alleged by the BBC Panorama programme that Lloyds TSB Jersey was encouraging wealthier customers to evade paying tax. An employee of Lloyds was filmed telling a customer how several mechanisms had been found to make their transactions invisible to the UK tax authorities[18]. This action is also in breach of Money Laundering Regulations in Jersey[19]. Lloyds subsequently claimed that this action was an isolated incident which they were investigating.

Near collapse, toxic assets and direct UK Government assistance

By September 2009 Lloyds TSB and the rival Royal Bank of Scotland had, combined, received £40 billion in direct government aid.[20]. Lloyds has toxic assets totalling £260 billion[21].

Response to surging public anger

It was announced in February 2010, that Eric Daniels had declined his personal bonus of £2.3 million in consideration of the intense anger existing amongst the public about the harmful effects to the UK economy of rescuing Lloyds Banking Group from collapse. This is the second year he has not received a bonus. His annual salary of £1 million remains unaffected[22]. For comparison, the average earnings for "corporate managers" in the UK in 2009 were £745 per week, representing 3.5% of Mr Daniel's pay before his bonus[23].

EU Competition Law

The assistance given to Lloyds TSB has raised concerns about unfair advantage[24]. Neelie Kroes has indicated Lloyds will need to divest large parts of its business to comply with EU regulations.

In December 2008 the British anti-poverty charity War on Want released a report documenting the extent to which Lloyds TSB and other UK commercial banks invest in, provide banking services for and make loans to arms companies. The charity writes in its report that Lloyds TSB is the only high street bank whose corporate social responsibility policy does not mention the arms industry. The report claims that Lloyds TSB is the second largest shareholder among high street banks in the arms industry.[25]

References

  1. ^ Lloyds Bank to merge with TSB Group New York Times, 12 October 1995
  2. ^ Lloyds TSB: Case Study The Work Foundation, January 2005
  3. ^ Change of Company Name RNS Announcements, Lloyds TSB Group, 16 January 2009
  4. ^ Trustee Savings Banks Act 1985 (cap. 58)
  5. ^ Lloyds TSB Act 1998 (cap. 5)
  6. ^ Lloyds Bank (Merger) Act 1985 (cap. 9)
  7. ^ COMMERCIAL STREET 1. 1164 (West Side) SE 02 NE SP/147 Lloyds Bank II 2, see Images of England No. 447622 National Monuments Record, English Heritage (retrieved 23 November 2009)
  8. ^ Proposed Alternative to GAPS/Capital Raising RNS Announcements, Lloyds Banking Group, 3 November 2009
  9. ^ About Us Lloyds TSB Foundation for England and Wales (retrieved 3 October 2009)
  10. ^ 1. 5028 HIGH STREET (north side) Teddington No 23. Lloyds Bank TQ 1671 23/26 II 2, see Images of England No. 205455 National Monuments Record, English Heritage (retrieved 23 November 2009)
  11. ^ "Worst bullying case in 30 years". Sun Newspaper online. 2007-07-10. Retrieved 2009-08-30.
  12. ^ Consumer forum http://www.consumerforums.com
  13. ^ "An overdraft? That'll be £200 at Lloyds TSB (but only £15 if you're a Muslim)". Mail Online. 2009-08-22. Retrieved 2009-08-30.
  14. ^ Sanders, Claire (2006-06-30). "University grandee reaches for his lawyer". Times Higher Education Supplement. Retrieved 2009-02-16.
  15. ^ Lloyds boss to come clean on tax, The Sunday Times, March 8, 2009. Retrieved on 10 March 2009
  16. ^ "Lloyds stokes union fury as job losses after HBOS merger deal reach 8,200". Times online. 2009-07-17. Retrieved 2009-08-30.
  17. ^ "Lloyds gets record £100m fine for mis-selling 'precipice' bonds". The Independent on Sunday. 2003-09-26. Retrieved 2009-08-30.
  18. ^ "Tax inquiry into Lloyds off-shore". BBC. 2009-09-21. Retrieved 2009-09-23.
  19. ^ "Q&A: Panorama on Lloyds offshore". BBC. 2009-09-21. Retrieved 2009-09-23.
  20. ^ "EU ruling threatens Lloyds' branches". Financial Times online. 2009-09-25. Retrieved 2009-10-03.
  21. ^ "EU ruling threatens Lloyds' branches". Financial Times online. 2009-09-25. Retrieved 2009-10-03.
  22. ^ . Times Online. 2010-02-23 Eric Daniels bows to pressure http://business.timesonline.co.uk/tol/business/industry_sectors/banking_and_finance/article7037043.ece= Eric Daniels bows to pressure. Retrieved 2010-02-26. {{cite web}}: Check |url= value (help); Missing or empty |title= (help)
  23. ^ . Office for National Statistics. 2010-02-26 National Statistics Online http://www.statistics.gov.uk/cci/nugget.asp?id=285= National Statistics Online. Retrieved 2010-02-26. {{cite web}}: Check |url= value (help); Missing or empty |title= (help)
  24. ^ "EU ruling threatens Lloyds' branches". Financial Times online. 2009-09-25. Retrieved 2009-10-03.
  25. ^ War on Want, Banking on Bloodshed
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