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September 20, 2010    

Lloyds chief exec to step down

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by Kay Murchie

The chief executive of Lloyds Banking Group, Eric Daniels, has announced he will retire next year.

The announcement follows other leadership changes in major banks earlier this month.

Barclays’ chief executive, John Varley, will be departing next year and will be replaced by Bob Diamond, currently president of Barclays Plc.

In addition HSBC chairman, Stephen Green, is moving on to take up the post of trade minister with the Coalition Government.

Mr Varley and Mr Green are both well-respected bankers who have steered their banks through the financial crisis without the need for taxpayer support.

However, in the case of Mr Daniels, he and former Lloyds chairman, Sir Victor Blank, both faced heavy criticism following the controversial takeover of HBOS in autumn 2008.

Fifty-nine year-old Daniels is the longest serving CEO at a major British bank and will continue in his post until next year when a replacement is found.

Commenting on the departure, Lloyds chairman Sir Win Bischoff said: “The entire board and I are grateful to Eric for his leadership as chief executive since June 2003, particularly since the announcement of the acquisition of HBOS in September 2008.

“The successful integration of the two companies and the sooner-than-expected return to profitability of the enlarged Lloyds Banking Group are testament to his disciplined and vigorous leadership during a time of unprecedented financial turmoil,” he added.

Shareholders, however, feel different about the takeover. An investor group called Lloyds Action Now, which was established over a year ago, claimed investors were lured into voting for the takeover, while not being provided with all the relevant information – particularly in respect to HBOS’ finances.

The group of shareholders claim they were misled into voting for the takeover without being informed that loans to HBOS from the Bank of England totalled approximately £25.4 billion.

While the loans have now been repaid, they were not disclosed in the takeover documents.

Lloyds is currently 41% owned by the taxpayer.

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