As Lloyds Shareholders Vote On Merger, Where Are The ‘HBOS Banking Knights’ Sir Peter & Sir George?

Lloyds shareholders will vote on the HBOS merger (read takeover) in Glasgow today, but strangely there has been no comment so far from our ‘banking knights’ Sir George Mathewson (former RBS chief) and Sir Peter Burt (former HBOS deputy chief). Sir George and Sir Peter have been gunning to remove the HBOS board and take over the company themselves, so that they can block a merger with Lloyds and ‘keep HBOS independent’, which is cryptic speak for ‘keep banking power in Scotland, and more importantly, give us braw jobs’. They’ve even set up a wildly amateur website, and sent an angry letter to the HBOS chairman Lord Stevenson threatening to “seek your and Andy Hornby’s removal from the Board and the appointment of George and myself.” POW!

But right at this critical juncture, when Lloyds is voting on the merger, Sir Peter and Sir George are keeping quiet. Why? Because not only has both Alistair Darling and the trade union representing half of HBOS’s employees come out against an independent HBOS, but the mystery bidder the knights have been touting for months has forgotten to show up.

Alex Neil, the SNP politician who has basically been acting as the knights mouthpiece, was claiming as far back as September 21 that he had an elite team of bankers on board (including the knights) to organise a £6 billion bid for the Scottish part of HBOS. By November 6 Neil was claiming a mystery bidder was going to be announced within the next seven days. And now that crunch time has arrived? No deal.

So the save HBOS/Scottish nationalist junket can now only look to the governement for support. And Darling will only hand over billions of taxpayer pounds to plug the funding void that Neil promised to fill if the taxpayer is getting good terms. Darling has suggested he would only buy more equity in HBOS at its market share price (63p rather than 113p at terms agreed during the bailout), and at interest rates similar to market norms (i.e. the 14% the sheiks have been getting for their Barclay’s investment, rather than the 12% the treasury offered in the bailout). What’s wrong with that, eh? Sounds totally sensible to me.

Not to Neil though: “Once again the Treasury seems to be doing everything it can to inject doubt and frustrate alternate plans that could keep HBOS independent and safeguard competition and tens of thousands of jobs.”

What alternative plans were those again? And where are the knights?

UPDATE:

It appears Sir Peter has lowered his lance, calling a bid for an independent HBOS now “effectively improbable”.

Posted by Jonty Rhodes in Hot Money | November 19, 2008 11:48AM |