Lloyds Banking Group PLC — Capital/Financing Update 2011

Dec 14, 2011

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C.20549

FORM 6-K

Report of Foreign Private Issuer

Pursuant to Rule 13a-16 or 15d-16

of the Securities Exchange Act of 1934

14 December 2011

LLOYDS BANKING GROUP plc

(Translation of registrant's name into English)

5th Floor

25 Gresham Street

London

EC2V 7HN

United Kingdom

(Address of principal executive offices)

Indicate by check mark whether the registrant files or will file annual reports

under cover Form 20-F or Form 40-F.

Form 20-F..X.. Form 40-F.....

Indicate by check mark whether the registrant by furnishing the information

contained in this Form is also thereby furnishing the information to the

Commission pursuant to Rule 12g3-2(b) under the Securities Exchange Act of 1934.

Yes ..... No ..X..

If "Yes" is marked, indicate below the file number assigned to the registrant in connection with Rule

12g3-2(b): 82- __

Index to Exhibits

Item

No. 1 Regulatory News Service Announcement, dated 14 December 2011

re: Preferred Bidder for Branch Divestment

14 December 2011

LLOYDS BANKING GROUP ANNOUNCES PREFERRED BIDDER FOR EC MANDATED BRANCH DIVESTMENT (VERDE)

Lloyds Banking Group today announces that, having further reviewed the formal offers for its EC mandated retail and commercial business divestment (Verde) the preferred option is a direct sale and the preferred bidder for the business is The Co-operative Group.

Lloyds Banking Group will now progress more detailed exclusive discussions with The Co-operative Group, with the aim of agreeing heads of terms by the end of Q1 2012. The Group will continue to progress an Initial Public Offering (IPO) during this phase of the discussions.

Tim Tookey, Interim Group Chief Executive and Group Finance Director, said: "We are pleased to be reporting progress with the Verde divestment which continues to move forward in line with our expectations. I am confident that we will complete the transaction by the end of November 2013, in line with the EC mandated timescale."

This is subject to regulatory approval.

• END -

For further information:

Investor Relations

Kate O'Neill +44 (0) 20 7356 3520

Managing Director, Investor Relations

Email: kate.o'neill@ltsb-finance.co.uk

Corporate Affairs

Matthew Young +44 (0) 20 7356 2231

Director of Corporate Affairs

Email: matt.young@lloydsbanking.com

FORWARD LOOKING STATEMENTS

This announcement contains forward looking statements with respect to the business, strategy and plans of the Lloyds Banking Group, its current goals and expectations relating to its future financial condition and performance. Statements that are not historical facts, including statements about the Group or the Group's management's beliefs and expectations, are forward looking statements. By their nature, forward looking statements involve risk and uncertainty because they relate to events and depend on circumstances that will occur in the future. The Group's actual future business, strategy, plans and/or results may differ materially from those expressed or implied in these forward looking statements as a result of a variety of risks, uncertainties and other factors, including, without limitation, UK domestic and global economic and business conditions; the ability to derive cost savings and other benefits, as well as the ability to integrate successfully the acquisition of HBOS; the ability to access sufficient funding to meet the Group's liquidity needs; changes to the Group's credit ratings; risks concerning borrower or counterparty credit quality; instability in the global financial markets; changing demographic and market related trends; changes in customer preferences; changes to regulation, accounting standards or taxation, including changes to regulatory capital or liquidity requirements; the policies and actions of Governmental or regulatory authorities in the UK, the European Union, or jurisdictions outside the UK, including other European countries and the US; the ability to attract and retain senior management and other employees; requirements or limitations imposed on the Group as a result of HM Treasury's investment in the Group; the ability to complete satisfactorily the disposal of certain assets as part of the Group's EU State Aid obligations; the extent of any future impairment charges or write-downs caused by depressed asset valuations; exposure to regulatory scrutiny, legal proceedings or complaints, actions of competitors and other factors. Please refer to the latest Annual Report on Form 20-F filed with the US Securities and Exchange Commission for a discussion of such factors together with examples of forward looking statements. The forward looking statements contained in this announcement are made as at the date of this announcement, and the Group undertakes no obligation to update any of its forward looking statements.

Signatures

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

LLOYDS BANKING GROUP plc

(Registrant)

By: Kate O'Neill

Name: Kate O'Neill

Title: Managing Director

Investor Relations

Date: 14 December, 2011