Lloyds Banking Group Plc (LLOY) is considering the sale of about 650 million euros ($840 million) of Irish real estate loans as the lender extracts itself from Western Europe’s biggest property crash, according to a person with knowledge of the planned transaction.
The U.K.’s second-biggest government-aided bank will have to sell at a discount, the person said without being more specific. He declined to be identified because the sale plans haven’t yet been finalized. Ian Kitts, a Lloyds spokesman, declined to comment.
Lloyds in 2010 began to run down and close the Irish unit it acquired two years earlier as part of a takeover of HBOS Plc. More than 90 percent of its 7.4 billion-pound ($11.2 billion) commercial real estate loan book there is impaired, according to the London-based lender’s annual report.
CarVal Investors LLC agreed to buy 380 million euros of Irish and U.K. property loans from the bank at about 25 percent of their face value in November. Lloyds also agreed to sell 1.5 billion pounds of Irish commercial real estate loans to Apollo Global Management LLC (APO:US) for 10 percent of face value that same month.
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