Lloyds Chairman Victor Blank Plans to Step Down by June 2010

(Bloomberg) -- Lloyds Banking Group Plc said Chairman Victor Blank plans to step down by June of next year, after the government-brokered purchase of HBOS Plc at the peak of the credit crisis led it to fall into state control.

Blank, 66, plans to retire by the annual meeting in June 2010, the London-based company said in a statement yesterday. Alexander Leitch, 61, was named the bank’s deputy chairman with immediate effect.

Blank’s departure is “definitely a good thing,” said Roger Lawson, a spokesman for the U.K. Shareholders’ Association. “The decision to buy HBOS was clearly a mistake and has resulted in a good quality bank, which paid a high dividend, being intermingled with the poor assets of HBOS.”

Lloyds agreed to buy HBOS for about 7.7 billion pounds ($11.7 billion) in September as the government sought to prevent HBOS from collapsing after credit markets froze. HBOS posted a 2008 net loss of 7.5 billion pounds, greater than Lloyds had originally expected. The British government now owns 43 percent of Lloyds and its stake may rise to as much as 75 percent.

Lloyds’ market value plunged 73 percent in 2008. The stock has declined a further 27 percent this year, valuing it at 15 billion pounds.

The bank wouldn’t have needed government money if it hadn’t taken over HBOS, Chief Executive Officer Eric Daniels told a parliamentary committee in February. Lloyds would have liked more time to examine HBOS’s accounts before making the purchase, he said.

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