LLOYDS TSB Scotland's corporate banking division has achieved a landmark £3 billion of lending and plans to expand its team in both Glasgow and Aberdeen to handle significant new business growth.

Mark Prentice, head of corporate banking for Lloyds TSB Scotland, also revealed the division's latest transaction, a £47 million deal with Glasgow City Council for the transfer of its car park assets to a new subsidiary called City Parking (Glasgow) LLP.

The newly formed subsidiary has taken over the off-street car parking operations of Glasgow City Council, including the main multi-storey car parks at Charing Cross, Cambridge Street, Concert Square and Cadogan Street.

"It was a very innovative deal and we won the business in competition with five other banks," said Prentice.

"Glasgow City Council came up with idea and we helped them to structure the deal. It was an innovative way of dealing with an asset which brings in lots of cash. The new structure enables the council to use that to fund other things," he added.

Prentice, who joined Lloyds TSB Scotland in July 1999 to set up a corporate banking team from scratch, says the division has grown its business at a rate of 35% per annum since then.

"We're growing income, profit and lending at a similar rate. I would like to think we can keep up our 35% growth rate year-on-year," Prentice said.

He said the deal market for businesses with turnover of more than £15m is hotting up in Scotland.

"The outlook is very strong. Our acquisition finance team is very busy with a number of juicy deals we hope to get over the line in the third quarter of this year," he added.

He declined to give further details at this stage but said several of the deals were in the oil and gas services sector, which is particularly buoyant. Lloyds TSB Scotland's corporate clients include Johnston Press, Miller Group, Wood Group and Aggreko and the bank has also funded deals by Robert Wiseman Dairies. Prentice heads a 20-strong team specialising in acquisition finance, property finance, and in deals involving the public sector including local government, housing associations and educational establishments.

"We've hired experienced bankers with the right attitude - a will to win. We plan to add more recruits to both our Glasgow and Aberdeen offices and I expect the team to increase by as much as 50% in the next two years," Prentice said.

He sees good growth opportunities in the public sector, particularly in niche areas such as social housing. Lloyds TSB Scotland led the £50m housing stock transfer for Argyll Community Housing Association last year, the biggest stock transfer in Scotland.

Opportunities in education involve the funding of university buildings and also purpose-built student accommodation.

Prentice said the division has also carved out a successful niche in providing 100% financing packages to small to medium residential housebuilders. "We don't take an equity stake. We get rewarded by a share of the profits. We don't want to own businesses, we want to support businesses," he said.

"We've completed three transactions involving 100% funding where the companies bought the land, built the houses and repaid the debt, all ahead of target," he added.

Prentice said the bank is extremely selective in choosing which builders to back, particularly given current concerns over signs of the housing market cooling.