London  - Britain's Lloyds Banking Group warned Friday that HBOS, the ailing lender it took over at the height of the banking crisis, is expected to report pre-tax losses of 8.5 billion pounds (12 billion dollars) for 2008.

The figure is 1.6 billion pounds greater than predictions made by the group in November.

Lloyds shares fell sharply on the trading update. The merged group said the Lloyds side of the business was still expected to make a profit of 1.3 billion for 2008.

Its final results are due to be published at the end of this month. (dpa)