Lloyds Banking Group has appointed the first tranche of firms to its customer-pay panel, after City banking teams were invited to pitch last month.

Firms including CMS Cameron McKenna, Addleshaw Goddard, Osborne Clarke, Reed Smith and Hogan Lovells have grabbed spots on the 12-strong customer pay panel.

Others are still waiting to hear whether they have won places on the roster, which was initially scheduled to be announced on 7 April.

Customer-pay work covers advice on transactions involving the bank's corporate and business customers, where the legal fees are passed onto the client.

As such, a spot on the customer-pay panel can represent an important source of client introductions for firms, as well as a significant revenue stream for banking and corporate teams.

"The terms of instruction aren't that different to own-account work," one banking partner told Legal Week in February. "Obviously the bank will look to use its purchasing power on behalf of its clients, and this means setting rates which are comparable to work carried out exclusively for the bank."

An internal Lloyds source said: "The customer-pay work is vital to the work of the legal team. It is as important to the bank as own-account work."

The panel review process marks the first time the bank has formalised arrangements for customer pay work. It was initially scheduled to take place in 2013, but was pushed back several times.

All firms appointed to the customer-pay panel have also previously held places on the bank's own-account roster, which was last reviewed in 2012 and saw firms including Linklaters and Berwin Leighton Paisner win spots for a minimum two-year term.

A Lloyds spokesperson said: "Customers are always our priority, and the group only works with firms who reflect this in the way they operate.

"The firms we instruct on behalf of our customers are just as important to the group as our own account work."

The spokesperson declined to comment on the broader customer pay panel process.