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Lloyds is pondering merger of Swip with Belgian bank Fortis

Lloyds TSB is reported to be mulling over a merger of Swip and Belgian bank Fortis’s asset management business which would create an investment giant with 155bn under management.

Rumours have been rife in the industry following share price moves this weekend that Lloyds might spin Swip off into a joint venture with Fortis’ 68bn asset management firm.

The move would create a UK and European asset management giant, with Lloyds being able to sell its stake in Swip completely or maintain an interest in the firm’s development.

Some analysts believe that the move would make parent Lloyds more attractive to a foreign buyer as the remaining businesses would form a simpler proposition.

Swip, which was demerged from Scottish Widows’ life and pension business in 2000, has 87.5bn under management of which more than 60bn is retail money including the mutual funds sold through the life and pensions business.

A Swip spokeswoman ref-uses to comment on market speculation.

Cavendish senior fund manager Paul Mumford says: “Lloyds TSB expanded by acq-uisition and now it may look to divest because it took on too much. If Lloyds were to get rid of Swip, provided that the price was okay, it would go down well with shareholders and make Lloyds more attractive to an overseas acquisition.”

PlanInvest managing director Michael Owen says: “I would be surprised if Lloyds sold Swip completely because it still has room to develop. It would be understandable for them to agree a tie-up arrangement, maintaining some int- erest in Swip.”

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