Rumours that Lloyds TSB is to dispose of its mortgage arm, Cheltenham & Gloucester (C&G), in a bid to aid its proposed merger with Abbey National, have been quashed by Lloyds.
The merger with Abbey National has been delayed due to fears that the company may monopolise the industry, and was referred to the Competition Commission in March. According to the Commission, possible measures for preventing adverse effects include the divestment of existing businesses, such as C&G. But Kirsty Clay, spokesperson for Lloyds TSB, described the move as speculation.
‘The Commission has reached its internal deadline on the matter, but it may be a long time before we hear a decision. Rumours that we are considering reducing our share of the mortgage market to help the bid go through is just speculation,’ she said.