Returning bank chief to decide on sell-off

It is understood the Portuguese chief executive, who has been on extended sick leave through exhaustion since 2 November, believes such a decision will send the clearest signal that Lloyds has moved on from the turbulence triggered by his absence.

One banking source said: “A decision on whether to sell the so-called Project Verde assets will be made by March.

“Horta‑Osorio will want to get a good handle back on the state of the negotiations with Co-operative Bank [named last month as the preferred bidder for the branches].

“He will want to take stock, but not delay too long on making a final decision.”

Some believe that the Lloyds chief executive, who stayed at the Priory clinic as part of his recovery from sleep‑deprived stress, may announce his decision soon to prevent the issue overshadowing the bank’s annual results in late February.

The group made a £3.9bn loss in the first nine months of 2011 after Horta‑Osorio, who succeeded Eric Daniels as chief executive last spring, took a £3.2bn provision on payment protection insurance mis-selling.

A condition of Horta-Osorio’s return is that he will focus on strategy and not micro-manage the business.

However, it is understood that chairman Sir Win Bischoff ruled out having a “right-hand man” to take some of the management load off the CEO’s shoulders.

Instead, greater operational responsibility will be devolved to the boss’s key lieutenants. These include two executives he poached from his former employer, Santander: chief risk director Juan Colombas and wealth and international director Antonio Lorenzo.

Other executives taking on more day-to-day responsibility will be Alison Brittain, who runs the Lloyds TSB and Bank of Scotland retail business; David Nicholson, who does the same job with the Halifax; and the group’s wholesale banking director Truett Tate.