LONDON - U.K. regulators have blocked Lloyds TSB Group PLC's $25.4 billion bid for Abbey National PLC, saying the purchase would give Britain's No. 4 banking company too big a share of its banking market.
A takeover of Abbey, the second-largest U.K. mortgage lender, would give 236-year-old Lloyds TSB control of 27% of the country's checking accounts and the biggest share of U.K. home loans.
Investors and analysts say Peter Ellwood, 58, chief executive officer of Lloyds TSB, needed Abbey National to help his company catch such faster-growing rivals as Barclays PLC and Royal Bank of Scotland Group PLC. The rejection leaves him with few chances to expand through purchases in the United Kingdom, and it will increase pressure on him to deliver on a pledge to find a partner outside Britain, observers say.