20 January 2018
visit www.ebaday.com

Lloyds completes MBNA acquisition

01 June 2017  |  2752 views  |  0 Source: Lloyds Banking Group

Lloyds Banking Group ('the Group') today announces that it has completed the acquisition of MBNA Ltd (MBNA), a UK consumer credit card business, from FIA Jersey Holdings Limited, a wholly owned subsidiary of Bank of America, following receipt of regulatory and competition approval.

The transaction is consistent with the Group's stated strategic ambitions of growing in Consumer Finance and will enable the Group to enhance its position and offering within the UK prime credit card market through the MBNA brand. The purchase terms are in line with those previously disclosed and the purchase is expected to deliver strong financial returns including:

· an underlying Return on Investment that exceeds Cost of Equity in the first full year and increases to c.17% in the second full year following the acquisition

· c.3% and c.5% statutory EPS accretion in the first and second full years following the acquisition

Given the transaction will enhance Group net interest margin by c.10bps per annum there will be a c.5bps benefit to net interest margin in 2017. The transaction has been funded through organic capital generation with c.80 basis points of Common Equity Tier 1 (CET1) capital retained on the Group's balance sheet since the end of 2016.

Commenting on the transaction, António Horta-Osório, Group Chief Executive, said:

"The acquisition, which is funded through strong internal capital generation, increases our participation in the UK prime credit card market, where we were underrepresented, and strengthens our position as a UK focused retail and commercial bank. The MBNA brand and portfolio are a good fit with our existing card business and we will focus on providing its customers with excellent service and value. Our proven integration capabilities and low cost to income ratio will deliver significant synergies and value to our shareholders."

Comments: (0)

Comment on this story (membership required)

Related company news

 

Related blogs

Create a blog about this story (membership required)
visit www.ebaday.comvisit www.capgemini.comvisit www.niceactimize.com

Top topics

Most viewed Most shared
Europe begins Open Banking era in subdued styleEurope begins Open Banking era in subdued...
12221 views comments | 33 tweets | 38 linkedin
BofA leads on blockchain patentsBofA leads on blockchain patents
7541 views comments | 11 tweets | 12 linkedin
Standard Chartered establishes fintech innovation and investment unitStandard Chartered establishes fintech inn...
7401 views comments | 14 tweets | 14 linkedin
hands typing furiouslyFintech Adoption is About People, Not Tech
6640 views 1 | 6 tweets | 2 linkedin

Featured job

Competitive
Germany, Austria or Switzerland

Find your next job