Britain’s first superbank

Source: Exec Digital UK

Date :18/09/2008 09:37:47

Lloyds TSB has sealed a £12.2billion HBOS deal, creating Britains first 'superbank'.

Lloyds TSB announced this morning, September 18, it will pay £12.2bn for HBOS in a rescue that will create the country's biggest mortgage lender.

Under the terms of the deal, HBOS shareholders will receive 0.83 Lloyds shares per HBOS share.

The deal brings together household names including Bank of Scotland, Halifax and Scottish Widows, and was thrashed out against a backdrop of HBOS's tumbling share price.

HBOS chairman Lord Stevenson and Chief Executive Andy Hornby are departing the enlarged business, leaving Lloyds Chief Executive, Eric Daniels, as the most powerful figure in British banking. The Government waived normal competition law on "public interest grounds" to ensure the stability of the UK financial system.

"This is a landmark day for the British financial services industry. If you think about the company it really puts us on the global scale," Mr Daniels said.

However it is feared that up to 40,000 staff could be axed.