November 25, 2009

U.S. private equity investor JC Flowers is circling Britain's weakened banking industry, prepared to swoop on forced divestments over the next 12 months, according to the firm's new European and Asia Pacific boss.David Morgan, a former chief of Australia's Westpac Banking Corp (WBC.AX), told Reuters on Wednesday that JC Flowers had a $2.3 billion fund available for such acquisitions and that only a "very small portion" of this had been invested so far.

Partly nationalized lenders Royal Bank of Scotland (RBS) (RBS.L) and Lloyds Banking Group Plc (LLOY.L) are both expected to put assets up for auction over the next few years. RBS's commodity-trading unit is anticipated to be among them."RBS and Lloyds have had directions from the authorities that they do need to divest significant parts of their business," Morgan said in a phone interview from Brisbane.

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