According to media sources, the bank has deducted the deal prices by as much as 50%, considering the volatile market condition and bank shares under pressure.
The UK bank has initiated the sale process after receiving order from the European Commission to dispose the branches by November 2013, and to repay the state aid.
The deal accounts for a 4.6% share of the UK current account market and up to 19% of Lloyds’ mortgage book, with around five million customers.
It is estimated that the deal will fetch anywhere in between £900m and £1.5bn to Lloyds, helping it to repay the loan it obtained from various sources, during the financial turmoil of 2008, said the bank.
Lloyds has chosen UK’s biggest mutually-owned business Co-op Bank as its preferred player to land the package of assets against consolidation vehicle NBNK Investments.
The deal, if finalised, will triple the size of Co-op’s banking business.
Lloyds has agreed to provide the systems and technology platforms required to manage a large banking operation, after the successful completion of the deal.
