This week, it seems likely that Lloyds Banking Group will launch its second rights issue this year. As a shareholder in the group, owning 15.3 million shares, the Lloyds TSB Foundation for Scotland was excluded from the first offer. Our legal advice was that we should have been included and should now be due a payment of £2 million.
However, despite repeated attempts to ascertain why the group did not make the offer to us, it has failed to respond definitively. So we now face the prospect of a second rights issue, which could result in the foundation being owed further monies, w
ith no explanation of why we are being excluded by the group.
In present circumstances this money would provide a crucial lifeline for the foundation and the charities that depend on it until we can reach a settlement with the group on future funding.
Let us be clear: any money we receive from the rights issues is not a "donation" to the foundation or some act of generosity, it is ours by right of our shareholding. Would the group be allowed to withhold information – and money – from other shareholders in the way it is doing to the foundation around these rights issues?
Lloyds Banking Group has received significant levels of financial assistance from the government to help it through what may be a short but tough period. Yet, ironically, it is not prepared to give the foundation money to which it is legitimately entitled as a shareholder, which could be used to plug the gap caused by the group's intransigence around its dealings with the foundation on the way forward.
MARY E CRAIG
Chief executive, Lloyds TSB Foundation for Scotland
Gorgie Road, EdinburghIt is my understanding that the Lloyds banking group wants to cut its funding of the Lloyds TSB Foundation for Scotland from 1 per cent to 0.5 per cent of future profits, put a representative on the board of trustees and have a say in where funds are distributed.
As I understand it, the foundation has asked Lloyds to "lend" it money until the bank gets back into profit and then continue funding, when the foundation would repay its "loan". However, the banking group has refused to do this unless the foundation accepts conditions which would compromise its independence and mean a dilution in real terms of monies the foundation is entitled to by way of the covenant put in place by an act of parliament.
Forgive me, but isn't that exactly what the banking group asked the government to do at the height of the banking crisis? If it is good enough for the bank, why can it not do the same for the foundation? Is it because those at the top are more interested in profits than helping the most needy in our communities?
PETER McLAUGHLIN
Inchmurrin Gardens
Glasgow