Lloyds TSB, a UK retail bank, is launching a renewed push into investment banking nearly three years after its previous efforts were quietly shelved.

The bank has appointed Farouk Ramzan, a former director on Société Générale's corporate bond origination desk in London, to run debt capital markets with a mandate to build its bond origination and execution capabilities. Lloyds created its debt capital markets business earlier this year to focus on structured credit and derivative-related businesses in an effort to boost revenues in its corporate markets wholesale banking division. Ramzan is expected to join on January 8 after just over three months of gardening leave. The bank originally intended to build a securities arm in the wake of Big Bang but plans were dropped after the stock market crash of 1987. It announced another push in February 2004 but after promising expansion and a wave of hires, little was heard of the plans. Lloyds, ranked 47th this year as an underwriter of all international bonds, is rated 51st in underwriting international euro bonds and 21st for sterling bonds, according to financial data provider Dealogic. Eric Daniels, Lloyds' chief executive, said during the bank's interim results in August that it was aiming to capture higher income from acquisition financing, debt capital markets and derivatives. Lloyds' wholesale and international banking division reported profits before tax of £768m (€1.14bn) at the end of June, up 11%, or £73m, compared with the same period last year. Corporate markets provided the bulk of profits within the division at £512m, compared with the other three areas of business banking, asset finance and international banking. Equity analysts at Keefe, Bruyette & Woods, the boutique investment bank, said in a report in October: "Although not one of the biggest participants in capital markets, the global markets division within wholesale generated 27% of group profits in 1H06 – the comparator for BarCap is only modestly higher at 33% of Barclays Group." Lloyd's raided a team of six structured credit specialists last year from Fortis Bank to help with its structuring and distribution capabilities. In July it made two appointments in DCM origination and trading. Last year the bank brought in about 1,000 staff for its corporate banking division, many from larger investment banks, including JP Morgan, HSBC and Deutsche Bank, as part of a business overhaul. Its 2004 push was led by Stephen Targett, former chief executive of wholesale and international banking. He wanted to increase income from sales and services to corporate clients in the division from between 10% and 20% in 2002 to 70%. However, he left the bank less than six months after joining.