Lone Star, a US private equity group, has been named as the exclusive bidder for £900m-worth of distressed property loans currently owned by Lloyds Banking Group, according to the Financial Times.
The property loans, known as the Project Royal portfolio, is the biggest disposal of loans by a UK bank since the 2008 recession.
It's suggested that the deal could be the catalyst for a number of similar deals.
Subscribe to MoneyWeek
Subscribe to MoneyWeek today and get your first six magazine issues absolutely FREE
Sign up to Money Morning
Don't miss the latest investment and personal finances news, market analysis, plus money-saving tips with our free twice-daily newsletter
Don't miss the latest investment and personal finances news, market analysis, plus money-saving tips with our free twice-daily newsletter
Other bidders who are now said to have been ruled out as of Tuesday night are Cerberus and Colony Capital.
The banking giant, which before only sold single loans, will take as much as a 40% loss on the value of the portfolio.
Lloyds' share price rose 2.07% to 27.66p by 12:31PM.
NR
-
A junior ISA could turn your child’s pocket money into thousands of poundsPersuading your child to put their pocket money in a junior ISA might be difficult, but the pennies could quickly grow into pounds – and teach them a valuable lesson about money
-
Cost of Christmas dinner jumps 6.5% as grocery price inflation rises againThe average Christmas dinner for four now costs £32.57 as grocery price inflation increases - but what does it mean for interest rates?
