March 11 (Bloomberg) -- Paulson & Co., the hedge-fund firm that made more than $3 billion betting the U.S. housing market would collapse, may have made 311 million pounds ($428 million) since September by short selling Lloyds Banking Group Plc and HBOS Plc.

Paulson, run by billionaire John Paulson, took short positions in Lloyds and HBOS valued at about 367 million pounds in September, based on the holdings and share prices on the dates they were reported. The position equaled 0.79 percent of London-based Lloyds, or 129.1 million shares, after the banks merged and holdings were diluted by a government investment. That position was worth about 56 million pounds on March 9, when it fell below the reporting threshold.

Lloyds, which surrendered control to the government on March 7 in return for asset guarantees, is down 82 percent since Paulson first disclosed a short position in the bank. Paulson made at least 295 million pounds by shorting Royal Bank of Scotland Group Plc when the fund closed its position in the bank in January after five months.

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