A company's growth can normally happen in one of the two ways. Organic or inorganic growth. Merger and acquisition mainly results from inorganic growth. In the early 1990s, there was a great increase in the number of mergers and acquisitions in the banking industry.
Lloyds TSB has recently grown through a further acquisition. By acquiring HBOS (Halifax/Bank of Scotland) plc, the Lloyds Banking Group has become the largest retail bank in the UK. Around half of all people in the UK (30 million) now bank with the Lloyds Banking Group. The group has the largest branch network of any UK bank and 140,000 staff. The acquisition also means that the new group has a broader range of expertise with multiple brands under its banner. It is a more diverse business, with stronger market presence in areas such as mortgages, insurance, finance and investments. With refer to this merger and acquisitions hold major organizational behavior challenges such as Change of Human Resources Management, Culture, Conflict and change within the organizational for managers at various levels of the firms involved.
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This paper attempts to chronicle the acquisition of HBOS bank by Lloyds TSB bank that tried to create theÂ UK's leading financial services group. Unlike previously written papers that describe the performance of the firm before and after the acquisition, this paper focuses on the human resources management, culture, conflict and change issues involved in the acquisition before and after the acquisition is completed. This paper tries to explain the organizational behavior of the acquired bank's personnel and what their expectations, fears, hopes, and beliefs are before and after the transaction takes place.
1.0 Background of Lloyds TSB Group
Lloyds TSB is a leading UK based financial services group providing a wide range of banking and financial services, primarily in the UK, to personal and corporate customers. The main business activities are retail, commercial and corporate banking, general insurance, and life, pensions and investment provision. The Group has a large and diversified customer base and services are offered through a number of well recognized brands (Lloyds TSB, Cheltenham & Gloucester, Scottish Widows), and via a unique distribution capability comprising one of the largest branch networks in the UK and intermediary channels. On January 16, 2009, Lloyds Banking Group plc acquired HBOS plc. In November 2009, The Bank of New York Mellon Corporation completed the acquisition of Insight Investment Management Limited from the Company.
Lloyds TSB Group is quoted on the London Stock Exchange and is one of the largest companies within the FTSE 100, with a market capitalization of £26.7 billion on 31 December 2007. At the end of 2007 total group assets were £353 billion and the Group has nearly 70,000 employees. Total income for the 12 months to 31 December 2007 was £18 billion with profit before tax totaling £4 billion.
The group activities are organized into three businesses: UK Retail Banking, Insurance and Investments and Wholesale and International Banking.
2.0 Human Resource Management
Human Resources Management (HRM) can play a very important role in the success of HBOS merger. HRM is acting an important source of the input while evaluating whether to go ahead with a given merger or not. According to Carter McNamara "The HRM function includes a variety of activities, and key among them is deciding what staffing needs you have and whether to use independent contractors or hire employees to fill these needs, recruiting and training the best employees, ensuring they are high performers, dealing with performance issues, and ensuring your personnel and management practices conform to various regulations. Activities also include managing your approach to employee benefits and compensation, employee records and personnel policies". (Carter McNamara, 2009)
2.1Challenges faced by new organization
HRM help in ensuring that the employees of acquired new organization remain motivated after the merger. According to the Fisher (1989), transfer of the HRM practices can be difficult in organizations with different cultures compared to transfer of other resources like technology, capital and others. But this does not deter the transfer of HRM practices. It is further important to differentiate between the requirements of various organizations and it is not necessary a uniform policy can be successful across the broad.
Always on Time
Marked to Standard
After the merger, HR policies are directed focus at two directions. The first one, is to achieve integration and provide a good working environment through a good compensation policy and training programs. Secondly, the main objective of the HR policies is to meet broader objective like bringing about a culture change in the organization.
According to Fisher (1989), immediately after merger there is focus to make the operations move profitability and productive, as a result to focus on restricting operations and cutting costs. One of the key tool applied is downsizing the workforce. So, new management uses merger an opportunity to implement some of the difficult decisions in both the acquired and acquirer organization.
2.1.2Changing new strategy
The merger is essential to define new common strategies to align the new organization towards its new vision. According to Recklies (2001), the vision of the merged organization is one of the first issues to be addressed before merger stage of the process of the transaction. The Lloyds TSB is necessary to align the HRM strategy of the new organization with the M&A strategy. According to Aguilera and Dencker (2004) the following conceptual tools have been used to identify the key HRM challenges in M&A key:
Resources- people and capital
Processes- activities involved in converting inputs to output
Values- employee's mode of thinking
Table 1: Comparison of various merger strategic based on certain conceptual tools in the new organization
Product/market Extension strategy
Substitute to R&D strategy
Reduce in manpower.
Downsizing strategy is essential for achieving economic of scale.
Reserve of manpower as the managers of the two organizations specializes in different function.
Reserve of employees in order to facilitate sharing of technology and knowledge.
Processes are similar and not much changes are required.
Processes are different and their integration is one of the key issues for the success in the merger. Training system can help in this regard.
Processes of the participating organization are different and need to be aligned with the help of training to help on transfer of knowledge.
Differences in values are not much different if the organization is operating in the same geography and market.
Values are differences and should be integrated smoothly.
Value is similar and can be aligned easily.
2.1.3 Structure issues
Due to the acquisition with HBOS, this is an important decision to be made by HR during the integration of the merger is determination of the management structure. According to Anderson (1998), this is a decision that should be made as soon as the deal for the merger is signed by both the parties to avoid confusion among the manager about their roles in the new organization. A centralized structure with well defined relationships is necessary in order to enable quick decision making and accountability among the managers. Conflicts are likely to occur while designing the organizational structure due to the assignment of positions in the hierarchy. This can be prevented to certain extent by ensuring the managers from both the organizations are present in the different layers of the organization. The determination of the hierarchy of the organizations should be purely based on the merit.
2.1.4 Leadership issues
After the merger, a new clear leadership will be appointed. These appointmentsÂ are subject to formal FSA approval andÂ will become effective upon the completion of the HBOS acquisition. (Source from Lloyds TSB press release) According to Sitkin and Pablo (2004), a clear leadership has a positive impact on the employees of the organization. Leadership includes the individual leader of the organization at the top and both the top management. According to De Georgio (2003), the management is likely to face the barriers while deciding the leaders of the organization:
Lack of time
Lack of information about candidates from the other organization
Split in the differences in culture, the leader should be able to communicate the mission, values and vision of the organization successfully to the employees.
2.1.5 Downsizing and persisting key talent
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The merger usually results to redundant people. The objective of the new entity is to persist with the most capable person regardless of the original company they belong in. The process is not based on the objective measures and fairness it could change the attitude of employees towards the merger and employees may not look at it favorable. This will make employee focus on their personal job security and worries rather than on the larger organizational objectives.
The management is reluctant to communicate with the employees of these issues in before merging stage. Any failure in the communication or vague communication will makes the employees uncertain about their career and future role in the organization. They may seek other information source like informal communication and rumors which has a very negative impact on their performance and also will increase the anxiety. The only way to solve this matter for the management is to open a frequent channel of communication with the employees. Regular and honest communication can stabilizing the effect on the employees. For more effective in the communication, the management should address the issues that are most relevant to the employee such as layoffs, compensation, change in benefits and change in responsibilities.
2.1.6 Culture integration issues
The new organization will faced culture integration issue. Where, this is the toughest matter that companies face in merger is the two different cultures. According to Bowick who lead the HR through the HP-deal merger deal day "it's critical to get people speaking the same language. For instance, discovered the people at both organizations were using the term 'customer solution', but it meant different thing to each of them". In order to solve culture integration, HR management needs to be the first to identify the disconnexion and get discussion. The role of HR in the whole merger process has undergone changes in given the failures in number of deals that due to problems in cultural integration. (Bowick, 2002)
The key role of the HR manager will face after merging phase is to identify the mission, vision, values and culture that the organization plan to implement. These activities of HR manager in the integration process is include the aligning and defining employees with the strategies vision, developing effective communication channel, integration philosophy, conflict management and defining uniform HR practices across the whole entity.
The HR managers need to make a proper assessment of the new organization's culture. There is also a trend that the HR executive needs interviews with the senior management of the new organization to evaluate the leadership qualities. HR Executive also need to create a profile of the best practices of the organization and compare it with their own staff to identify similarities and differences. Besides that, HR executives also need to identify common points in the two culture from where they can base the whole process of the integration after the acquisition.
2.1.7 Conflict management
Conflict is likely to occur almost the employees in the after merging phase. HR manager need to keep in place on conflict resolution and escalation plan. It is also responsible for organizing training the managers in conflict management. Conflict can often arise due to culture differences, control, structure, not clear demarcation of role and responsibilities, organizational hierarchy and miscommunication. Through these issue of conflict resolution will be part of the integration plan the HR should be ready for contingencies.
Organization can be conduct in many ways such as culture, virtual, organism, brain, political system and so on. Organizational culture is the first issues that they need to consider to acquisition HBOS. Organization culture refers to the general culture within an organization, and is always also referred to as corporate culture, though that isn't the best description since a large non-profit organization or charity could also have its own organizational culture even though they are definitely not corporations. Gareth Morgan has described organizational culture as: "The set of the set of beliefs, values, and norms, together with symbols like dramatized events and personalities that represents the unique character of an organization, and provides the context for action in it and by it." (Morgan, 1997)
Figure 1- Ways of seeing an organization (2006 p.139 fig.5.4) Brooks claims there are many ways of seeing an organization.
Organizational is aâ€¦.
The Lloyds TSB takeover of HBOS is not only means merging of two different financial organizations but also an acquisition of two different cultures. The new management have to be ready to facing new challenges when the two organisations are merging. Bicultural audit is important for the merging of two organisation's culture. This audit produces data for starting work platform, strategy required for successful merger. The three types are as follows:
Identification of cultural gap- Is comparing the values, vision and management behaviour for both companies, this phase recognizes the gap.
Analysis of cultural gap- This phase brings out the similarities and dissimilarities between the two organizational cultures.
Culture bridging- Refer to the basis of the above two information's the data management team can start the bridging of culture process.(Bicultural Audit, by Richard Cook)
3.1 The Cultural perspective:
According to Brooks I (2006 p.140) "Culture and organization can be viewed as an iceberg, a metaphor which suggests you to see on the surface masks a much deeper, mystical and powerful reality".
It seen that though Lloyds TSB, they have merged with many companies in previously, they were all similar culture so that the original culture of Lloyds TSB is still stayed undiluted. (Source: Company Corporate Responsibility Review 2007, VAULT Employee Satisfaction Surveys and Media Articles)
Lloyds TSB is based on Artifacts:
Recruit talented people through tough selection procedure.
Employees rewarded on the basis of client satisfaction.
Create framework for employee clear learning and future needs.
Provide personal development programs for employees.
Their Anglo-Scottish merger earlier between Halifax and Bank of Scotland however it seems have resulted in dilution of both cultures. (Source: Company Corporate Responsibility Review 2007, VAULT Employee Satisfaction Surveys and Media Articles)
HBOS is based on Values:
3.2 Type of Culture between Lloyds TSB and HBOS
Lloyds TSB is based on role cultured:
Produce more output in good environment.
Strong banking system.
HBOS is based on task cultured:
Focused on goals.
Work in team.
It seems there are cultural differences between Lloyds TSB and HBOS, due to these culture differences it can make misunderstandings, fuelled emotional reactions, and conflicts. This can conduct to negative attitudes by the key top managers and be a major obstacle to the successful integration of the two organizations. Cultural differences will appear to be a critical factor in creating such an atmosphere and obtaining people's cooperation.
Figure 2: As per Deal & Kennedy Feedback-Rise Model:
- High Risk
- High Feedback
- Bet your company culture
-Process driven culture
As per Hofstede's study model (Source: Social Responsibility Report 07/08)
Low-Acceptance of responsibility
Low- Basic innovations
Collectivism vs. Individualism
Low- Management mobility
Masculinity vs. Feminity
High-Mass production, efficiency and bulk chemistry
Low- Personal service, custom made products and biochemistry
Long vs. Short term orientation
High- Developing markets
Low- Fast adaptation
Is process that begins when an organization or party perceives differences and opposition between itself and another organization or party about interest and resources, belief, values or practices that matter to them. According to Gareth R. Jones and Jennifer M. George's, "conflict is the discord that arises when the goals, interests or values of different individuals or groups are incompatible and those individuals or groups block or thwart one another's attempts to achieve their objective." (Gareth R. Jones and M. George, 2008)
4.1 Positive of conflict
4.1.1 Clarification of view
The Boards of HBOS and Lloyds TSB believe that the Acquisition is a compelling business combination which offers substantial benefits for shareholders and customers. There is a clarification of view in the Acquisition is accelerates to build the UK's leading financial services company by focusing on growing sustainable earnings streams, based on deep customer relationships.
4.1.2 A chance for people to test their capabilities
The group has excellent breadth and balance with strong positions in Retail, Corporate Banking, SME Business Banking and Long Term Savings. The group will have a substantial direct personal customer base and the means to unlock the significant commercial opportunities offered by Lloyds TSB's and HBOS's. The combined group will benefit from a portfolio of strong and trusted brands including Bank of Scotland, Halifax, C&G and Scottish Widows. With these strong trusted brands, customers have more confident to choices or try the different products that the new organization offers.
4.1.3 Long-standing problems brought to the surface and resolved
Normally, cost synergies savings are always a long-term issues for organization to solve, with the merger with HBOS will lead to an additional contribution to earnings before tax from cost synergies significantly in excess of £1 billion per year.
4.1.4 To produce better idea
The Acquisition brings together two of the leading retailers in UK financial services, with strengths in customer relationship management, product design, branch sales processes and in telephone and internet banking through gain sustainability competitive advantage in banking industry.
4.2 Conflict comparison between Lloyds and HBOS
4.2.1 Differences in perception
Remains to grow the business through developing long-term customer relationships and building customer franchise.
Delivering growth in profits to its many shareholders and transparent, fair, value-for-money products and services to its customers.
Perception is the process of acquiring, interpreting, selecting and organizing sensory information to achieve the organizational goals. The important of perception is to find innovative solution for the problems, to leverage creativity and motivation the higher plateau of thinking, to help of perception, habits and attitudes will get changed and can find solution the most difficult problems.
Lloyds TSB and HBOS may have different motives on perception going such as increasing market share, achieving economic of scale, entering new market, acquiring new technologies, warding off threats of hostile takeover and diversification. Different perception might cause the failure in Merging.
4.2.2 The Nature of work activities
Its main business activities are
Commercial and corporate banking
General insurance and life
Pensions and investment provision.
The HBOS Group's products and services can be categorized into the following business
Insurance & Investment
Strategy & International
Treasury and Asset Management.
The merge of Lloyds TSB and HBOS were similar nature of working activities so there is no much changes of the organizations business or activities. In might change in the staff's working activities such as changing department, office and so on. With this change, staffs will beneficial in changing new working environment where some of the staff had feel bored, inefficiency with the current position. Secondly, staffs are able to learn new skills in the new working place.
Change nature of activities will change characteristics, beliefs, values, and expectations. Some of the staff will have demanding in the salaries, position, rewards and so on. Besides that, changes a person's nature of working activities might waste time because the person might not have the skills or confident with the department they change it need to take time to learn.
4.2.3 Role Conflict
And despite its black horse logo, Lloyds TSB is more of an old nag, following the market and paying poor rates to long-standing customers.
Lloyds TSB, on the other hand, markets decent-sounding accounts to new savers but then closes them, often paying dreadful rates of interest to those still stuck in them.
In Lloyds TSB's subsidiary Cheltenham & Gloucester has complicated accounts which dock interest when you take money out or limit you to a certain number of withdrawals a year from an easy access account.
Halifax has a reputation as an innovator when it comes to savings accounts - its behavior can still hark back to its building society roots as it balances the interest of savers and borrowers.
For instance, Halifax was among the first to offer a regular savings account paying a top rate of interest. Halifax makes a great effort to persuade its savers to move from old accounts to better-paying ones, and has been a leader in trying to reunite savers with old, forgotten accounts.
Role is an important process functional in an organization. May increase efficiency in process and product and services and gain competitive advantage in banking industry.
Changes in role for both organizations will have negative impact such as inefficiency structure, lack process, take longer time than previously, and change in new rules and regulation and so on.
4.2.4 Departmentalism and specialization
Lloyds TSB Corporate Markets is one of theÂ UK's leading providers of corporate banking, supporting businesses with an annual turnover in excess of £15m.
We provideÂ specialized financing to a range ofÂ industry sectors.Â Some of theseÂ services include:
Cash management and payments,
Foreign exchange andÂ risk management,
LoansÂ andÂ bonds,
It is about integrating business activities so that HBOS acts as a good corporate citizen and meets the expectations of its stakeholders: colleagues, customers, shareholders, Government, the media and society. Included amongst the activities that HBOS aim to integrate are:
Marketplace - products, financial literacy, inclusion - promoting the interests of shareholders and customers; dealing fairly with suppliers.
Employment - total reward, diversity, wellbeing - how HBOS aim to attract and retain the best workforce.
Community - community investment, volunteering, sponsorship - how HBOS manage our relationship with society in general.
Environment - responsible resource stewardship, etc. - managing organizational environmental impacts effectively.
Departmentalism and specialization is a structures and the performance of the respective firms. By working in departmentalism and specialization, the staff in Lloyds TSB and HBOS are able to work efficiently through their skills, knowledge, professional and interest.
Failure on departmentalism and specialization, the organization will not perform well, loss on business profit, lack of efficient, organization collapse, in a mess daily function and so on.
4.2.5 Limited Resources
Customers: 16 million
Savings: Lloyds is the UK's fourth largest saving provider.
Retail saving balance: £65 billion
Revenue: £18 billion (2007)
Profit: £4 billion (2007)
Customers: 22 million
Savings: HBOS is the market leader
Retail saving balance:£139 billion
Revenue: £21,291 million (2007)
Operating income: £5,149 million (2007)
Profit: £4,109 million (2007)
Mergers and acquisitions generally succeed in generating cost efficiency through the implementation of economies of scale. It may also lead to tax gains and can even lead to a revenue enhancement through market share gain. With refer to the acquisition; Lloyds TSB could achieve 'cost saving' from the £1.5 billion a year.
In order to achieving revenue and cost synergies, Lloyds TSB and HBOS will face the conflict problems such as reduces 20,000 redundant staff, 164 branches network to close.
4.3 Conflict challenges faced between Lloyds TSB and HBOS are as follows:
Job insecurity due to recession
Financial crises in the market
Searching for new investors
Quick decision on merging with HBOS
Fund raising from the whole sale market
Clearing the picture about the organization
5.0Nature of Organizational Change in Lloyds TSB and HBOS
Is refers to the overall nature of activities, such as their extent and rate, that occurs during acquisition that aims to enhance the overall performance of the organization. The activities are often led by a change agent, or person currently responsible to guide the overall change effort. The activities are often project-oriented and geared to address a current overall problem or goal in the organization. Besides that, organizational change also involve in external and internal environment of an organization is in a state of constant change. The organization has to re-adjust itself to this changing scenario in order to sustain competitive advantage in the market.
5.1 External forces of change
External forces of change create from outside the organization. This is because these forces have global effects; they may cause an organization to question the essence of what business it is in and the process by which products and services are produced. There are four key external forces for change such as: demographic characteristics, technological advancements, market changes, and social and political pressures.
5.2 Internal force to change
Internal forces to change are come from inside the organization. These forces may be subtle, such as low morale, or can manifest in outward signs, such as low productivity and conflict. Internal forces for change also come from both human resource issues and managerial behavior.
5.2.1Human Resource issues
This issues stem from employee perceptions about how they are treated at job and the match between individual and organization needs and desires.
Excessive interpersonal conflict between managers and their subordinates is a sign that change is needed. Both the manager and the employee may need interpersonal skills training, or the two individuals may simply need to be separated.
5.3 The stage of Organizational Change in Lloyds TSB and HBOS
According to Robbins (2003), a well-known approach to managing change, that requires people to go through three separate processes, is called Lewin's Three-Step Change Model. Lewin developed the threeâ€‘stage model of planned change which explained how to initiate, manage, and stabilize the change process. The three stages are unfreezing, changing, and refreezing (p. 564).
Figure 3: Movement of an organization from a status quo to a desired state
The first transition step is unfreezing, requires a personnel to say goodbye to the way things used to be. The managers must understand that their employees are being asked to give up tasks and processes that have made their previous successful in the past and all the emotional and resistance factors will kick in if enough time is not allotted for this step. The second step is movement, when everyone shifts into neutral. The employees in the organization may have given up their old ways of accomplishing tasks, but they may not quite ready to start using the new process. Employees may seem a slight uncomfortable and there is often confusion. Managers have to manage movement step carefully if not the staffs may try to revert back to the old process. A comparison for unfreezing and movement differences is provided at below. The final step is refreezing, when everyone moves forward and starts accomplishing tasks in the new manner. Again, the great care must be taken when managing this step to identify resistance and prevent personnel from going back to the original process.
Figure 4: The differences between unfreezing and movement
Table: (a) An organization before the change; the Change Group is inactive
(b) Organization after the organization change
5.3.1Resistance to change in Lloyds TSB and HBOS
According to Sohal (1998) stress that the reasons for the failure of many change initiatives could be found in resistance to change. Resistance to change is introduces the costs and delays into the change process (Ansoff, 1990) that are difficult to expect (Lorenzo, 2000) is must be taken into consideration. Resistance also been considered as a source of information, being useful in learning how to develop a more successful change process (Waddell and Sohal, 1998). With refer to Lloyds TSB and HBOS merger case, resistance to change is a key reasons in changing management and should be seriously considered to help the organization to achieve the advantages of the transformation. According to Christensen & Overdorf, there are three reasons why people resist change in organization:
Resources- how to provide employees with the resources they wants to make the changes, be supportive of their efforts, and listen to their problems such as provide training after the merger.
Processes- The acquisition will change in process of planning and implementing in organizations in such a way as to minimize employee resistance and cost to the organization, while also maximizing the effectiveness of the change effort.
Values- Acquisition make change such as culture, norm cause predictable behavior. With this change will results in different task and role relationships, informal norms may become invalid, making a new set of norms necessary. Employees may resist this.
5.4 The Positive and negative changes issue faced by Lloyds TSB
The merger will create a new vision for Lloyds TSB to be the UK "superbank" 'or leading financial services group.
The merger will gain cost synergies.
Can sustainability in competitive advantage.
Build up new branding.
Might increase stakeholders confident.
Increase company share.
Diversification of new product and services.
Increase new customers.
Increase new entrant/ new market.
Reduce injection from governance
The merger will affect thousands of jobs redundant.
Affect hundred of branches closedown.
Poor new leadership, HR management, structure and so on will cause the organizational not functioning efficiency.
Is a high risk for takeover
The staff might not incorporate.
Failure is in high rate because not 100% successful in acquisition.
Might face new law and regulation.
Reduces some of the branches will cause company reputation and customers confident.
With the above analyze, we know that Lloyds TSB has a strong culture compared to HBOS. A strong culture could seem advantageous for the sake of strong performance, and weak culture is believed that to arise due to employee empowerment. But a strong culture might be failure if it is too strong and suppresses creativity. It also can be failed in a volatile market when the company needs flexibility. The Lloyds TSB and HBOS culture would be an asset according to the market situation. During this current market volatility the adaptive culture of HBOS may perform better than Lloyds TSB. But in the future, after the current economic crisis, the government may be imposing strict regulations on banks. In that case the most conservative culture of Lloyds will be good.
Lloyds TSB is a leader which aims to be the top financial company in UK. Since, they are focus on "Balanced scorecard" for their performance on relationships and on the completion task; it is a task of oriented company. Lloyds TSB can use authoritarian style in which the leader sets the goal and reward system for the team members. Lloyds TSB have a directive style in the leader by provides a certain specific direction to the subordinates, who follow the given regulations and rules. Lloyds TSB is demonstrating possibly more concern for regulations and rules. However, in HBOS, they are a relationship based on organization as they are concerned with the relationship with the employees. As they are more concerned with their employee benefit they are basically is a people oriented company. Basically, HBOS can adopt some Laissez-faire style where there is more empowerment to the subordinates, giving team members more flexibility and allowing them to take decisions of their own-self.
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"We aim to set an example in the conduct of our business. We demand honesty and integrity in everything we do, and will not do business if our standards are endangered. We greatly value our good reputation." (Sir Victor Blank, Chairman of Lloyds Banking Group 2009)
Principal Subsidiaries: Lloyds TSB Bank plc; Cheltenham & Gloucester plc; Lloyds Bank (BLSA) Limited; Lloyds TSB Commercial Finance Limited; Lloyds TSB Leasing Limited; Lloyds TSB Private Banking Limited; The Agricultural Mortgage Corporation PLC; The National Bank of New Zealand Limited; Lloyds TSB Bank (Jersey) Limited; Lloyds TSB Scotland plc; Lloyds TSB General Insurance Limited; Scottish Widows Investment Partnership Group Limited; Abbey Life Assurance Company Limited; Lloyds TSB Insurance Services Limited; Lloyds TSB Life Assurance Company Limited; Lloyds TSB Asset Finance Division Limited; Black Horse Limited; Scottish Widows plc; Scottish Widows Annuities Limited.
Principal Competitors: Barclays PLC; HSBC Holdings plc; Prudential plc.
1765: Sampson Lloyd II and John Taylor found Taylors and Lloyds.
1770: Hanbury, Taylor, Lloyd and Bowman is formed.
1865: Lloyds and Company is incorporated as Lloyds Banking Company Limited.
1898: John Spencer Phillips becomes chairman of Lloyds Bank.
1918: Lloyds merges with Capital and Counties Bank.
1921: Lloyds acquires Fox, Fowler & Company.
1946: Lord Balfour succeeds J.W. Beaumont Pease as chairman of Lloyds.
1973: Lloyds Bank International is formed.
1986: Lloyds Merchant Bank is formed.
1988: Lloyds acquires controlling interest in Abbey Life Group PLC.
1995: Lloyds Bank Group merges with TSB Group to form Lloyds TSB Group plc.
2000: Lloyds TSB Group acquired with Scottish Widows
2009: Lloyds TSB Group Plc was renamed Lloyds Banking Group following the acquisition of HBOS Plc.