Lloyds Bank is considering entering the private rental sector as a landlord, according to a Financial Times scoop.
The newspaper says it's seen documents referring to a plan called Project Regeneration in which the company - Britain's largest retail bank - will buy and let out a range of new-build and existing properties across the UK. The bank aims to have its first tenants by the end of this year.
Lloyds, which also operates the UK's biggest mortgage lender - the Halifax - is reported to be keen to use its low funding costs, brand recognition and knowledge of the housing market to become a major operator in the private landlord market. The FT says the bank, which also owns Bank of Scotland, has existing relationships with almost all the UK's biggest housebuilders.
"As well as providing direct benefits through rental yield and house price growth, the bank is hoping the move will boost its existing businesses, for example by providing an opportunity to cross-sell rental deposit loans or insurance. It could also help fund Scottish Widows annuities" according to this morning's report.
"In addition to boosting its income, Lloyds executives believe their plan could fit with its stated social objective of 'helping Britain prosper' by offering better quality and more professional services to renters than many existing landlords. However, employee representatives cautioned that the initiative would also expose the bank to reputational risks if tenants have problems with the bank or the outsourcers it hires to manage the properties" the paper reports.
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