The small shareholders on both sides of the Atlantic trying to sue Lloyds over the disastrous takeover of the bankrupt HBOS in 2009 will be encouraged by the settlement reached by Bank of America, which was facing similar action over its rescue of Merrill Lynch.
Month: September 2012
What is amazing about the FSA judgement on Peter Cummings is not that they fined him £500,000 or banned him from financial services – as the man who presided over the HBOS corporate banking department responsible for the lion’s share of the losses some might think he got off lightly – but that no-one else appears to be under investigation.
In 1995 Bank of Scotland celebrated 300 years as Britain’s oldest commercial bank. Voted ‘most admired bank’, respected by competitors, applauded by investors and trusted by customers, it looked forward to the next three hundred. Less than 15 years later it was bust, reviled as part of the spectacular collapse of HBOS, the conglomerate it had joined. One of the high-profile victims of the credit crunch, its spectacular fall caused seismic shock waves throughout the financial world. What went wrong?
Ray Perman, who has followed the Bank since the 1970s when he was a Financial Times journalist, uncovered the story from documents and dozens of interviews with people at the top in Bank of Scotland and HBOS – from being the bank of choice for the high-rolling Monte Carlo mega-rich to losing £10 billion.
It is a cautionary tale for our times. In the complex world of modern global finance, the brilliant men who ran the company ignored the simple banking rules that their predecessors learned the hard way three centuries before.
You can read more about the book on its own website (hubristhebook.com coming soon) and buy direct from Birlinn or Amazon.