LONDON (Reuters) - Lloyds Banking Group (LLOY.L) has agreed to sell its stake in housebuilder Crest Nicholson, as the bailed-out British bank sheds non-core assets to refocus on its core lending activities.
Sources with knowledge of the deal said on Thursday that U.S. investment company Varde was buying the stake. One of the sources said Lloyds was planning to make a writeback on its previous valuation of the asset.
Lloyds, Britain’s biggest retail bank which was part-nationalized during the credit crisis, declined to comment on the value of the sale. The Financial Times had earlier reported it was priced at 150 million pounds ($232 million).
The Crest Nicholson disposal follows Lloyds’s sales in July of its private equity business to Coller Capital for 332 million pounds [ID:nLDE664069], and its Ecuadorian branch assets for $25 million. [ID:nRSa9794Pa]
Lloyds was saddled with billions of pounds of losses after it bought troubled rival HBOS at the height of the credit crisis of 2008 in an emergency deal brokered by the Labour government of the time.
Its problems led the state to take a 41 percent stake after spiraling bad loans forced the bank to accept a taxpayer-funded bailout, in return for which regulators have also demanded that it sell hundreds of branches.
Lloyds shares were up 2.7 percent at 74.25 pence by 0934 GMT, making the stock among the top gainers on Britain's benchmark FTSE 100 index .FTSE. The FTSE was up 0.8 percent.
Barclays Capital raised its recommendation on Lloyds shares to “equal-weight” from “underweight,” and traders also welcomed its sale of the Crest Nicholson stake.
Investment bank Lazard (LAZ.N) advised Varde on the deal.
(Additional reporting by Karolina Tagaris and Tricia Wright; Editing by Paul Hoskins and Erica Billingham)
$1 = 0.6463 pound