The asset sales, too, have proven to be problematic. Lloyd's agreement to sell hundreds of branches to the Co-Operative Bank wound up crashing the Co-Operative, and forced it into the hands of New York hedge funds.
The bank's latest asset sale is a $1.06 billion sale of its Scottish Widows Investment Partnership, which manages $320 billion in assets, to Aberdeen Asset Management. The deal will leave Lloyd's with a 9.9% stake in Aberdeen, which in turn becomes Europe's biggest independent fund manager.
That's just part of the Scottish Widows group, however. The bank continues to own the group's life insurance, pensions and investment business. That business is being accused of moving pension funds into so-called "dud funds" without their knowledge. and was also implicated in scandals during the last decade
Despite all this, some analysts consider Lloyd's a buy. Over the last year the shares are up 78%. The reason for that is in 2013 it has once again become a moneymaker, earning over three billion British pounds, about $4.8 billion.
All this is why bank regulators have such a difficult time. Our regulators are told that our banks must compete, as are their regulators. Crossing ethical and even legal lines is seen as a cost of doing business. Government ownership is no panacea.
Any wonder mistrust of banks is rampant on both sides of the Atlantic?
At the time of publication the author owned no shares in companies mentioned here.
This article was written by an independent contributor, separate from TheStreet's regular news coverage.