Lloyds Banking Group has said that it is planning to buyback bank's bonds form hundred thousand retail investors.

The bank's plans to buy back bonds is facing criticism as some suggested that it is planning to short-change its retail investors who helped the banking group survive the financial crisis. The state-owned bank announced plans to buy back or exchange up to £8.4billion of bonds that were issued in 2009 to supplement its £20.5 billion bailout from taxpayers.

The bank said that it will take a £1 billion charge on its profits from buyout investors. However, the media reports have suggested that the bank is trying to buy back the shares cheaply. Lloyds issued bonds called Enhanced Capital Notes in 2009 in order to build up its capital and ensure that it did not have to ask the government for funds.

Lloyds was not forced to continue paying billions to the Government like other banks that were bailed out by the government. Investors were asked to swap their existing Lloyds bonds for the new Enhanced Capital Notes as the bank warned that it will suspend their coupon payments for two years if they did not agree to the swap.