Do you have a better credit rating than your bank?

Posted: Tuesday, 22 December 2009 @ 15:43

This must have been a question Lloyds Banking Group's customers were asking themselves this morning with the announcement that Lloyds agreed to pay at least $3.6 billion over 15 years to raise $2 billion in capital.

According to Bloomberg, the bank sold hybrid Tier 1 securities on Dec. 15 that cost 12 percent, or $240 million a year in interest, until 2024. That’s a higher interest rate than bicycle-rack maker TriMas Corp. paid to sell senior notes, which Moody’s Investors Service rates Caa1, seven steps below investment grade.

Moody’s defines securities rated in the Caa category as being “of poor standing and subject to very high credit risk.”

No wonder when I've been asking banks recently the question "On which aspect of lending are you currently focusing?" I've received the response "Getting it back!"

Steven Petty, Commercial Property Solicitor

This blog is not intended to constitute legal advice, nor is it intended to be a complete and authoritative statement of the law, and what we say might be out of date by the time you read it. You should always seek legal advice to confirm whether or how any information in this article applies to your particular situation. We offer a free telephone consultation to discuss your particular circumstances.

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Thank you. Your response is great, very straight to the point! Hopefully this will bring an end to the matter. I will certainly be recommending your services as I am very impressed with the prompt dealing of this matter.
Janet Burbidge

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