The Government will not underwrite Lloyds Banking Group's planned rights issue, potentially compounding the challenge for the partly state-owned bank to raise enough capital to wriggle free of the toxic asset insurance programme.
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...
THE SURPRISE fall in youth unemployment has been dismissed as the ‘lull before the storm'.
The rise in unemployment in Britain slowed abruptly in the three months to August as the number of young people out of work fell, official figures showed yesterday reports The Times.
Unemployment climbed by 88,000 to 2.47 million, but the number of young people out of work fell to 946,000 - 1,000 fewer than the record high set in the three months to July.
The number of people signing up for jobless benefits climbed at the slowest pace in 16 months in September, rising by 20,800 to 1.62 million. Among 18 to 24-year-olds, the figure increased by nearly 8,000 to 490,000. See story...
What made financial headlines over the weekend?
To promote 'long-term investment'
Switching 'hard and expensive'
Smaller funds still packing a punch