Lloyds shares fall 4 percent after Reuters report

Shares in British bank Lloyds fell as much as 4 percent immediately after Reuters broke news that Australia`s National Australia Bank would not bid for the 630 branches on sale under current terms. NAB was touted as a strong candidate for the branches and repeated media reports had said that it was talking to Lloyds about a possible deal. The story, after checks from three sources involved in the deal, reported the Australian bank was spooked by the deal size and the huge funding gap. It also went on to say National Australia Bank would stage a comeback if Lloyds diluted the terms and made the deal attractive. The story was picked up by the Sydney Morning Herald and Daily Telegraph.