Lloyds and the government

kah22

Right didn't see a more appropriate board so here goes. I'm trying to find answers to a few questions

I’m a small shareholder in Lloyds TSB (roughly 5000 shares which I bought over a period of years when I had some loose cash.) I bought with cash that I didn’t need and with the intentions of just letting the shares sit and reinvesting dividends, I also planned in buying a few more as surplus cash became available, but I don’t understand what is happening at the moment.

Now I’m still a shareholder with Lloyds TSB except it now seems that the government has come in and bought up a really major stake in the company. So my question is this – these shares which the government is buying; where are they coming from? Are they been bought on the open market, or are they share certificates that Lloyds had for sale come a rainy day? Or, perish the thought; have they effectively taken up a large percentage of my shares and shares for which I will get no benefit?

Let’s jump down the road two years from now and assume that the recession has ended or is coming to an end. What then? As of now it seems that the governments stance is that this is just an emergency exercise on its behalf and that when it is safe to do so they will withdraw from been a stakeholder in the bank. I assume then that Lloyds TSB will have to buy back these shares in some way or other.

I suppose what I’m asking is for someone who bought shares to sit on them for ten or twelve years am I really going to be any worse off, no way am I going to sell and loose such a big percentage I’d rather wait and take my chances– and this might sound a strange question to ask but is now a good time to actually increase a shareholding given that the big institutions have taken their money and run and that has dropped the price – if Lloyds TSB survives, and I believe it will, then the big institutions will return and prices will be pushed up.

Am I making sense?

dacouch

Your shares will be down for at the very least the medium to long term. If the government had not stepped in thye would have been worthless

jonesMUFCforever

dacouch this is only partially correct.
LTSB was/is a profitable bank with very little exposure to this mortgage swap derivative rubbish that seems to have nearly bought the whole world's financial system to its knees.
Its problem started when it was persuaded to take over HBOS which has a shed load of these toxic debts.

Indeed HBOS would have been the next Northern Rock and nationalised if it had not been taken over which of course is of no help to all of LTSB's shareholders of which I am one.

level200

No wonder they are in trouble, I upgraded my account last week and my account manager said that i will have my new card in 2 days. one week passed and i called up to find out where my card was only to find that it has not been ordered!!!!