Trillion pound giant

Ride 'em How-boy ... how Halifax star Howard Brown could appear on Lloyds TSB's Black Horse in ads for merged bank

Ride 'em How-boy ... how Halifax star Howard Brown could appear on Lloyds TSB's Black Horse in ads for merged bank



The £12billion merger was agreed after a day of intense talks. It is
felt the banks’ combined muscle will be able to see off further
crises.


An insider said: “The deal has been done. As long as there are no
last-minute hitches.” Details will be unveiled today.


Staff at HBOS, Britain’s biggest mortgage lender, are said to have
been warned to expect up to 40,000 redundancies. That would be around a
third of the bank’s 142,000 combined staff.



Mega-bank ... how merger firms match up





The merger will be bad news for millions of consumers too, with a mammoth bank
controlling so much of the market.


The deal came after HBOS held “advanced talks” with its
rival after the value of its shares continued to collapse, fuelled by
worries over its exposure to a falling housing market.


Frenzied



Its share price plunged more than half from 182p to 88p in frenzied early
morning trading.


But shortly after 9am, news surfaced of emergency merger talks and the price
bounced back – closing the day down 34.9p (19 per cent) on 147.1p.


There were fears that HBOS had been targeted by “short-selling”
– where City traders effectively bet that a company’s
share price will fall.


Alex Salmond, the First Minister of Scotland – where around 17,000
HBOS jobs are based – attacked “spivs and speculators”
for targeting the bank.


He said any merger should be based on measured discussion – not a “shotgun
marriage” driven by speculation. He added: “I’m
very angry if we are going to see a bank merge not because it chooses, but
because it’s forced into that situation by short-selling spivs and
speculators unhindered in the financial markets.”


Gordon Brown intervened personally in efforts to save the High Street giant.
It emerged that the PM discussed the takeover with Lloyds TSB chairman Sir
Victor Blank on Monday night. He also contacted HBOS chairman Lord
Stevenson.


Last night Chancellor Alistair Darling vowed to “do everything we
can to maintain stability of the banking system because it is the best way
to help homeowners and people with money in banks”.


Merger talks were also backed by Shadow Chancellor George Osborne who spoke to
both banks’ bosses.


“Black horse bank” Lloyds TSB last night agreed a price of £2.32
a share for HBOS, around a fifth of the stock’s value last summer.

And that is bad news for the firm’s two million smaller
shareholders, many of whom picked up their holdings when Halifax
demutualised a decade ago.

Those who may lose their jobs include bespectacled Howard Brown, 42, star of a
long-running series of Halifax TV ads.


The bald crooner, whose commercials were voted TV’s most annoying,
was one of the real staff Halifax turned into stars.


In April, it was reported that he was being axed from the ads but he has still
been appearing on screen. It is unclear whether the ex-cashier, of Sheldon,
near Birmingham, will keep his job.


The FTSE 100 ended another day of credit crunch chaos down 2.3 per cent at
4912.4, its lowest level since May 2005.

Shares of investment bankers Morgan Stanley and larger rival Goldman Sachs
also fell yesterday. The Dow Jones closed last night at 10609.7, down 449.4.