Planned sale of 632 Lloyds branches to Co-op collapses

Lloyds Banking Group's sale of more than 600 branches to the Co-operative Group has collapsed.

Part-nationalised Lloyds, which is being forced by Europe to sell the branches after its £20 billion taxpayer bailout during the financial crisis, will instead pursue a stock market flotation for the division this summer.

The Co-op has reportedly struggled to plug a £1 billion capital gap needed to complete its takeover of the 632 Lloyds branches, blaming the weak economic outlook and heavy regulatory burdens.

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Lloyds branches sale called off

The sale of 632 Lloyds Banking Group branches to the Co-operative Group has collapsed. The financial institution, which is 43% owned by the taxpayer, was forced to sell them by European regulators.