Lloyds share price: More than 5,000 investors join HBOS lawsuit

on Nov 10, 2014
Updated: Apr 9, 2020
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iNVEZZ.com, Monday, November 10: More than 5,000 investors have joined a class action-style lawsuit against Lloyds Banking Group (LON:LLOY), the Financial Times has reported. The investors allege that they lost about £400 million over the purchase of HBOS in 2008.




Lloyds’ share price has lost about 0.3 percent at the opening bell in London this morning.


*h*HBOS lawsuit update*h*


The FT yesterday quoted lawyers for the claimants as reporting that the group of investors suing the 25-percent government-owned lender had grown by about a third, by number of shares owned, in a fortnight.


“”10,000 investors had started the registration process””


Damon Parker, head of litigation at law firm Harcus Sinclair, which is representing the group, told the newspaper that 10,000 investors had started the registration process with holders of more than 400 million shares having signed up so far.




The news comes after at the end of September, London’s High Court made a Group Litigation Order, designed to manage a large group of claimants. (Lloyds share price: Investors join forces to sue lender – https://invezz.com/news/equities/13532-lloyds-share-price-investors-join-forces-to-sue-lender)


The Lloyds Action group, led by Harcus Sinclair, claims that the lender’s former bosses breached fiduciary and other duties to win investor backing for the purchase of HBOS in 2008. The group alleges that £25 billion of emergency support from the Bank of England for HBOS and $18 billion (£11 billion) from the US Federal Reserve was not disclosed, and that Lloyds secretly loaned HBOS £10 billion to stay afloat.

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The FT quoted Sinclair’s Parker as estimating that if successful, the investors would be owed about £1 per share in compensation for the dilution they suffered in the 2008 rights issue.


Lloyds, which is due to file its defence by early December, has said that it would contest the legal action.


*h*Analysts on Lloyds*h*


As of November 08, the consensus forecast amongst 52 polled investment analysts covering Lloyds for the FT has it that the FTSE 100 group will outperform the market. The 25 analysts offering 12-month price targets for the stock have a median target of 86.00p, with a high estimate of 115.00p and a low estimate of 55.00p.




Lloyds updated investors on its quarterly performance last month, reporting that its underlying profit had climbed 35 percent to £5.97 billion in the first nine months of the year. (Lloyds share price: Lender confirms job losses as profits jump). The lender, however, took another £900 million charge for the mis-selling of payment protection insurance and confirmed that it would shed a further 9,000 jobs and close about 150 branches as part of a digital revamp.


**As of 08:00 GMT, buy Lloyds shares at 76.21p.**


**As of 08:00 GMT, sell Lloyds shares at 76.18p.**

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