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Lloyds eyeing MBNA

Lloyds Banking Group is all set to make its first acquisition ever since the bank was rescued by tax payers’ money in 2009. It is not preparing to bid for Bank of America’s £7 billion credit card business in Britain. News reports said MBNA, which is owned by BofA and has a loan book of about £7 billion, is likely to attract interest from a number of groups, including Barclaycard, Virgin Money, Santander UK and private equity groups. The business, however, fits with Lloyds’ search for acquisitions to accelerate its planned expansion in niche areas, such as unsecured consumer loans, car finance, leasing and fleet management. Lloyds was part of a consortium, including buyout group Cinven, that made an unsuccessful bid last year for LeasePlan, the fleet management arm of Volkswagen that was bought for €3.5 billion by a group of private equity and sovereign wealth funds. In the past year Lloyds has returned to a profit and restarted dividend payments, and analysts believe the bank has excess capital, which needs to be spent or returned to shareholders.

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