April 24 (Reuters) - Lloyds Banking Group's plannedsale of over 600 bank branches to the Co-operative Group has collapsed after the latter decided it could notproceed with the 750-million-pound ($1.15 billion) deal, theFinancial Times reported on Wednesday, citing two peoplefamiliar with the situation.
The deal was meant to lift the Co-op's share of Britain'sbank branch network to 10 percent from less than 4 percent andequip it to take on the country's "Big Four" lenders - HSBC, Barclays Royal Bank of Scotland andLloyds itself.
Both Lloyds and the Co-op were unavailable to comment on thereport.
The Financial Times said the cancellation of the deal, theterms of which were originally struck last summer, is set to beannounced as early as Wednesday. ()
Lloyds said last month that it was preparing for a stockmarket listing of the branches as a fall-back in case the dealwith the Co-op fell through.
As a condition of receiving state aid during the 2008financial crisis, Lloyds is obligated to sell the 630 branches-- known as the Verde network -- by the end of the year.
However, bankers are sceptical that the divestment of thewhole business could be completed by the year's end, theFinancial Times said.
Barclays (BARC)
Lloyds (LLOY)
HSBC Holdings (HSBA)