Govt won't back Lloyds' cash call - papers

According to the Financial Times, although the government, which owns 43.5 per cent of Lloyds, is thought likely to participate in the planned rights issue, officials insist that Alistair Darling, chancellor, has yet to decide formally. However, people involved in the process said that the government would definitely not underwrite the cash call, and so not make a commitment to mop up unbought shares. One market veteran said: "If an investor with nearly 45 per cent does not agree to underwrite an issue, it would send a pretty big negative message to the market." See story...