Is HBOS safe?

[*T*]

OK iTulipers, I have about 5% of my capital in solar/petro shares (that I'd rather not liquidate) with an HBOS-owned internet broker. The future of HBOS as an independent entity doesn't look too promising:


The rumour is that they will merge with Lloyds to provide a depositor base, so I feel OK about the risk for now. My question is, should I be so sanguine?

[Mega]

Re: Is HBOS safe?

Don't worry, Gordon is waming the Printing press right now!
Mike

[zoog]

Re: Is HBOS safe?

OK iTulipers, I have about 5% of my capital in solar/petro shares (that I'd rather not liquidate) with an HBOS-owned internet broker. The future of HBOS as an independent entity doesn't look too promising:


The rumour is that they will merge with Lloyds to provide a depositor base, so I feel OK about the risk for now. My question is, should I be so sanguine?

Apparently the rumours are true:

Sept. 18 (Bloomberg) -- Lloyds TSB Group Plc, the bank that considered buying Northern Rock Plc, will acquire HBOS Plc for about 12 billion pounds ($22 billion) to create a lender that controls more than a quarter of the U.K. mortgage market, two people with knowledge of the decision said.

Lloyds TSB will pay about 232 pence a share in stock for HBOS, 58 percent more than its closing price in London trading, said the people, who declined to be identified before an official announcement. Edinburgh-based HBOS, the U.K.'s largest provider of home loans, fell 19 percent yesterday to 147.1 pence.

HBOS, which lost almost half its market value this week, has been hurt by a shortage of funds to back its mortgages, leaving the company in the same predicament that led to the government- backed bailout of Northern Rock a year ago. Prime Minister Gordon Brown discussed the fate of HBOS with Lloyds TSB Chairman Victor Blank as recently as four days ago, according to a person familiar with the meeting.