Lloyds Rights Issue

Maybe you saw that Lloyds is embarking on a £13.5bn Rights Issue. If you already own Lloyds shares you will be given the option to buy 1.34 new Ordinary shares for every 1 you hold, at 37 pence each.  One might expect that Lloyds would be looking for additional funds after the HBoS take-over that was encouraged by the UK government.  It has since then emerged that the value of HBoS was inflated by a secret loan made by the Government and also that apparently Lloyds chief executive and the former chairman both knew about the secret arrangement. This was not disclosed to the investors during the time of persuading that a take-over of HBoS would be a good idea. With this loan, and another such secret loan made by the Government to RBS, having been repaid early this year it is not surprising that funds are low. No, I’m not going to refer to bonuses again…

My MBA class is now busy with the Integrative Project that sees them competing against each other in a virtual market – lots of hectic decision-making and, dare I say, a bit of industrial espionage taking place! After that we have a week of revision before the exams. And then, before we know it, it is time to pack our bags and set off for the Christmas break.

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