LONDON Dec 20 Lloyds Banking Group
said on Tuesday it had agreed to buy UK consumer credit card
business MBNA from a unit of Bank of America for 1.9
billion pounds ($2.35 billion) in cash.
The deal, which is expected to close in the first half of
2017, includes around 800 million pounds of acquired equity and
assumes 240 million pounds for future PPI claims, Lloyd's said
in a statement.
The British lender said it would fund the deal through
organic capital generation, which would use up around 80 basis
points of common equity tier 1 capital.
Despite that, the bank said it remained confident of being
able to deliver a progressive and sustainable ordinary dividend
MBNA, which made after-tax profits of 123 million pounds in
the first half of 2016, would add 650 million pounds a year to
group revenues, Lloyd's said, adding it expected to make cost
savings of around 100 million pounds.
($1 = 0.8073 pounds)
(Reporting by Simon Jessop; Editing by John Geddie)