For decades, Lloyds Bank’s corporate and institutional banking (CIB) division has been serving institutional clients across the financial sector including asset and wealth managers, financial sponsors, insurance firms and global banks.
In doing so, it plays a pivotal role in supporting its clients’ strategies, in turn fostering economic growth and bolstering London’s status as a leading global financial centre.
In 2023, Lloyds Bank appointed Lisa Francis as head of institutional coverage within CIB, to lead the newly expanded business unit focusing on building deeper client relationships and bringing the full breadth of the group’s capabilities to its institutional clients.
The development is part of the bank’s broader strategy to drive growth across its corporate and institutional client base. This mission, led by CIB’s CEO John Winter, has the institutional coverage team at the centre of it.
“The potential of growing the institutional business and helping to position CIB at the pinnacle of Lloyds Bank’s growth story is one of the main reasons I was attracted to the role,” says Francis, who has over 30 years of experience and expertise growing banking and markets businesses including previous roles at Barclays and NatWest.
“We have been building good momentum over the past year. The partnerships across the group are powerful,” says Francis, “and as part of our new institutional strategy, we’re bringing the full breadth of these capabilities to CIB’s institutional client base.”
Greater interconnectivity
A key focus for Francis and her team, and indeed part of the wider CIB strategy, is to support clients more holistically.
“The institutional ecosystem is continuously evolving – companies are consolidating and making acquisitions across our sectors, for example asset managers acquiring financial sponsors, financial sponsors acquiring wealth managers, and so on,” says Francis. “Many of our clients are looking at inorganic growth opportunities. We are well positioned to act as a trusted, holistic partner and support them through the deal cycle.”
Around 30% of CIB’s clients benefit from relationships across the group. These include relationships with Scottish Widows, a life insurer and workplace pension provider, Lex Autolease, a car leasing company, and Tusker, a salary exchange car scheme provider.
“Serving our institutional clients through one joined-up leadership group enables us to think more broadly about how we meet their needs,” says Francis. “This is making a big difference to our ability to deliver solutions.”
Serving our institutional clients through one joined-up leadership group enables us to think more broadly about how we meet their needs. This is making a big difference to our ability to deliver solutions.
An example of this is the recent sale of Scottish Widows bulk annuities to Rothesay – an institutional client of Lloyds Bank. The group’s markets franchise, Lloyds Bank Corporate Markets (LBCM), acted exclusively on the project, supporting Rothesay to maintain the derivative hedging on the £6 billion bulk annuity portfolio, whilst meeting the strategic and financial risk management objectives of both Lloyds Bank and Rothesay.
“This was a landmark transaction for us, and being able to execute this in-house and via our institutional client base showcases the strength of our relationships and our ability to deliver sophisticated solutions for our clients across both Scottish Widows and CIB,” says Francis.
Innovation in action
As well as connecting clients across the group, Lloyds Bank has recently enhanced its advisory propositions through the buildout of its data and ESG offerings.
Last year saw the launch of Lloyds Bank Market Intelligence, which leverages aggregated anonymised data from the group’s c.27 million retail customers.
“These valuable insights are helping CIB clients make more informed, strategic business decisions,” explains Francis. “And alongside our newly formed Lloyds Bank Market Insights team, and ESG advisory team, Lloyds Bank now provides a comprehensive suite of economic and advisory services to clients.”
Earlier this year, Lloyds Bank acted as joint ESG co-ordinator, lead arranger and agent for longstanding client CVC Capital Partners on their landmark AA+ rated €7 billion sustainability-linked loan facility, for their latest vintage Europe/Americas private equity buyout fund: CVC Capital Partners Fund IX.
“This was another major achievement for our franchise,” says Francis. “Not just in terms of arranging €7 billion of liquidity, but also in terms of working with Fitch to achieve a AA+ rating on the facility.”
In July, Lloyds Bank launched a multi-year co-investment partnership with Oaktree Capital Management, focussed on increasing the bank’s capabilities in mid-market leveraged finance. This new capability will allow Lloyds Bank to provide sponsors and management teams with a one-stop senior debt solution, reducing transaction complexity and simplifying clients’ banking relationships.
“The partnership provides us with a market leading, single name hold capability, a significant competitive advantage against our peers. This demonstrates how we’re transforming the way that we support clients in the sector,” says Francis.
Success despite the storm
Over the past few years, financial institutions have needed to navigate elevated interest rates – despite the first cut by the Bank of England in four years on August 1 – and a challenging and uncertain macroeconomic backdrop.
“Periods marked by bouts of volatility and rapidly changing conditions are when clients need us most,” says Francis. “I’m proud to say we have been there for our clients; listening to them, partnering with them and supporting them throughout. And despite the ongoing challenges, clients are telling us that they are relatively optimistic about the future of the economy.”
According to the 2024 Financial Institutions Sentiment Survey, proprietary research from Lloyds Bank based on the views of over 100 senior leaders in the sector, around half (48%) said they believe economic growth will improve over the next 12 months – up from 21% last year. In terms of growth within the sector, 43% of the surveyed executives believe financial sector growth will improve over the next 12 months – up from 27% in 2023.
We have a market leading track record in terms of our sterling capabilities, but clients are now recognising our ability to deliver in the euro and dollar markets too. As we see it, there is a huge opportunity for us to continue on that path.
“There is a bullishness in the industry, despite the challenges,” says Francis.
This overall industry confidence, coupled with the new CIB strategy, is certainly reflected in the results.
Over the past three years, LBCM has grown its markets business with institutional clients by 67%.
Furthermore, its FX traded volumes have increased 20.4% in the first half of 2024 on the same period last year, with the market as a whole only growing 11% during this time.
In the first half of 2024, LBCM’s debt capital markets issuance on behalf of institutional clients saw growth of 90% in the number of executed euro denominated transactions, and 100% in volumes underwritten. This comes on the back of a breakthrough year in 2023. Similarly, in the US dollar market, transactions executed on behalf of institutional clients in the first half of the year were up 20%, demonstrating a continued focus on that key market.
“We have a market leading track record in terms of our sterling capabilities, but clients are now recognising our ability to deliver in the euro and dollar markets too,” says Francis. “As we see it, there is a huge opportunity for us to continue on that path.”
Investing in experience
This period of business transformation has been further supported by increased investment and strategic international appointments.
Lloyds Bank recently welcomed Bill Mansfield, a former CEO of MUFG securities and head of global markets for the Americas, as CEO and country head for North America, and Anthony Bryson, a senior capital markets banker with over 30-years of experience, as managing director of LBCM in Frankfurt.
“Bill and Anthony are well-established, seasoned bankers that bring a whole different world of experience to the CIB business that marries with our growth aspirations,” Francis explains.
To illustrate the effectiveness of this approach, Lloyds Bank recently supported a well-known private equity firm with a fully underwritten €825m five-year senior term loan. The success of this deal was, in part, attributed to the bank’s ability to create a global relationship team alongside colleagues in North America.
“This is the largest underwrite we’ve undertaken in the market since 2015,” says Francis. “It’s testament to how we are transforming the way we do business with our clients, executing deals you may not naturally have associated with Lloyds Bank previously.”
Back in the UK, Lloyds Bank has appointed Tangwena Nelson – who joined on July 1 – as managing director and head of asset and wealth managers, a new position. Nelson brings with him a deep understanding of financial institutions and years of experience from the likes of Investec and Barclays Investment Bank.
In the coming months, CIB is also expected to announce another new appointment – head of insurance and group subsidiaries.
“These are key hires to help us create more trusted partnerships with our clients. I'm excited by the future and the opportunity in front of us,” says Francis. “We’re making the investments we need in people, systems, and the platform, and seeing the results – with more progress yet to come.”
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