Lloyds Boss Praises Coalition On Economy
The chief executive of Lloyds Banking Group has told Sky News that Government action in support of first-time home buyers is already proving a "game changer for the British economy".
The boss of Britain's largest mortgage lender, Antonio Horta-Osorio, dismissed suggestions of a looming house price bubble arising from the Help-to-Buy and Funding for Lending Scheme initiatives.
He backed Government support for the UK residential market because, he said, until three months ago house price rises remained significantly below the level of inflation.
"This is a temporary scheme to correct a market anomaly," he said.
Mr Horta-Osorio, told business presenter Jeff Randall that such schemes were helping instil confidence in a fragile economy.
He also expressed his view that the Government should not be a shareholder in UK banks.
Lloyds Banking Group, which also owns Halifax and Bank of Scotland, required a massive Government bailout in 2009 following the takeover of HBOS.
It remains 39% taxpayer-owned.
"It was an exceptional thing which should not happen again," he said
"It's up to the Government to decide when and how to sell the shares." But he said: "We've done our bit" by restructuring the bank.
"Selling Lloyds shares is the right thing to do," he insisted.
The group had already announced half-year profits this summer of more than £2bn and Mr Horta-Osorio said the share price had now risen to a point where taxpayers could have their money back at a profit.
The bank has been beset by a number of embarrassing scandals.
Compensation for the mis-selling of payment protection insurance (PPI) has cost Lloyds Banking Group £7.3bn so far.
Mr Horta-Osorio described that sum as a "monumental bill" but maintained it was important to "break with the past".
Next week, 631 Lloyds branches are to be hived off to form TSB Bank.
It follows the collapse in May of a plan to sell the branches to the Co-operative Group.
Mr Horta-Osorio dismissed the suggestion that the decision had been a grisly blunder but insisted it was the "best alternative" at the time.