Some banks have cut savings rates by 2 percentage points Lloyds may be told to reduce its market share by as much as a sixth under European competition rules governing state aid to private companies. The Financial Times reported on Saturday that EU Competition Commissioner Neelie Kroes had yet to make a final decision on the fate of the enlarged banking group, which was created by its rescue of HBOS at the height of the financial crisis. However she is expected to insist Lloyds sells off a substantial part of its retail and corporate operations with Royal Bank of Scotland also to be told to make disposals on a similar scale. Officials in Brussels rejected suggestions that Lloyds would have to sell recent merger partner Halifax to comply with the rules, but added it might have to close or sell a number of its 1,000 Halifax branches. They also said the banking group would have to do more than shed its Cheltenham and Gloucester subsidiary, which has 164 branches. "That is nowhere near enough – they would have to do something else," one official was quoted as saying.[Read more...]