UK Alistair Darling, the UK chancellor, is set to drop the £480m annual interest bill charged to Lloyds Banking Group on a taxpayer loan in exchange for a promise by the bank to provide billions of pounds in extra mortgage funding and loans to small businesses.
Mr Darling is prepared to convert £4bn of government preference shares – which carry a 12 per cent coupon – to ease financial pressures on Lloyds and as part of a wider deal to boost lending in the economy.
