Lloyds sells debt package

Lloyds Banking Group has sold a £778.6 million debt portfolio backing properties in Scotland and the north of England for just £390m – a 50 per cent discount.

American property investment fund Kennedy Wilson has paired up with Deutsche Bank to acquire Project Forth, a 41-strong defaulted loan pool 
secured by around 100 properties. The bad loans, part of the bank’s legacy of lending by the failed HBOS, are lent to 11 
separate borrowers.

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The deal is the third such UK property loan portfolio sold by Lloyds in the past year. Venture capitalist Lone Star acquired the £923m Project Royal portfolio, while Oaktree Capital Management acquired the £625m Project Harrogate portfolio. All told, the bank has sold six such bundles of bad loans in 2012 in an effort to improve its balance sheet.

Lloyds declined to comment.