Lloyds ‘to push ahead’ with £120m bonuses

Lloyds Banking Group is expected to award bonuses totalling £120 million to staff in its commercial and retail divisions despite forecasting massive losses at its taxpayer-owned subsidiary HBOS.

On Friday Lloyds said HBOS, which it bought out with government blessing and backing last year, would record losses of more than £10 billion for the full financial year.

But the group has also thrown the issue of bonuses for state-aided banks into the spotlight by insisting contractual bonuses would still be paid in “financial recognition” for staff who hit their targets.

“We never discuss how much money is paid to colleagues in bonuses,” a Lloyds representative said. “I can confirm that no final decision has been made on bonus outcomes. This is primarily a retail and commercial bank where many of our colleagues are on modest salaries.”

According to the Sunday Telegraph, rumours that the government was considering a bailout of Lloyds, which it already owns a 43 per cent stake in, are wide of the mark.

A No 10 source told the newspaper: “HBOS is much stronger and the taxpayer much better off as a result of the merger.”