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**Finance insight**Lloyds keeps two brands and seeks £25m savings

Lloyds TSB plans to keep its Lloyds UDT and Chartered Trust motor finance brands separate “for the foreseeable future”, despite looking for annual £25m savings from the newly combined businesses.

Lloyds surprised the industry when it paid £627m for Chartered Trust and ACL Autolease at the start of the month. Favourites to buy the company, which had been put up for sale by its parent bank Standard Chartered, were either GMAC or GE Capital Woodchester.

Chartered Trust's motor finance division will now merge with Lloyds UDT Finance to become the motor and leisure division within Lloyds TSB Asset Finance. With a combined new business turnover of “well in excess of £3bn a year”, Lloyds is now the largest independent in motor finance, ahead of First National.

Phil Stones is to be sales operations director of the division, reporting to John Davies, Asset Finance managing director. Both Mr Stones and Mr Davies were casualties of the original Lloyds Bowmaker and UDT merger who moved to Chartered Trust before going back to Lloyds UDT in the past 12 months.

Mr Stones said the Lloyds UDT and Chartered Trust businesses were “an excellent fit with little overlap”.

Lloyds operates primarily in the large dealer group and manufacturer joint venture market while Chartered has a large used car and medium sized franchise dealer portfolio. Mr Stones said cost savings would come from back office functions and the two brands would continue to have separate sales forces, though some management functions would be combined. The head office will be in Cockfosters, north London but each company's processing centres, in Edinburgh and Cardiff, will remain in place.

“Chartered Trust customers have chosen to deal with us because they want to,” said Mr Stones. “We don't want to lose that. This merger gives us the scale and size you need in the market these days.”

Meanwhile ACL Autolease is to be merged with Black Horse Vehicle Management to create a combined fleet of around 75,000 vehicles. It will be the sixth largest contract hire and leasing company in the country.

* GE Capital Woodchester, beaten in the race to buy Chartered Trust, claims it is now the number one provider of used car finance in the UK. The company said it now has a 15% market share while its new car penetration is up by over 50% since April last year.

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