There may also be little in the way of investment banking expertise that Lloyds can pick up from HBOS, even though the mortgage lender had been very active in trading asset-backed securities before being taken over by Lloyds last year.

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In fact, the lender had the ability to sell off the securities in ways that were unusual for garden-variety loans.

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Citi also agreed to become Ameriquest's chief "warehouse" lender, providing credit to fund loans and hold them until they are packaged into mortgage-backed securities.

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