FirstRand signaled its intent to divest Aldermore in April, citing a deeply flawed UK motor finance redress scheme that forced the firm to set aside £750 million to cover potential claims. Lloyds is reportedly eyeing the lender to bolster its small business and project finance capabilities, though sources indicate that no formal bid is guaranteed. Any potential buyer faces a complex transaction, likely requiring significant indemnities against future liabilities linked to the Financial Conduct Authority’s ongoing review of the motor loan market.
Lloyds is not alone in its interest, as Shawbrook is also exploring a possible combination with the lender. Both Lloyds and Aldermore remained silent on the reports, and the uncertainty surrounding the scope of the FCA’s redress program continues to complicate the sale process for FirstRand.
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