Did the government abuse its power in the banking sector?
While the banking sector has certainly fought back against the UK government and the various demands which have been made over the last eight months, some still believe this is payback time for the UK government, which is believed to have forced through the Lloyds bank and HBOS merger. Even though there is no hard evidence to suggest this is the case it is rumoured that Gordon Brown himself became involved in the talks and ultimately may have been behind the merger of the two entities.
There is a feeling that the UK government overstepped the mark, disbanding various competition issues and effectively rushing through due diligence, to encourage a public company to takeover a company which was literally on its knees at the time. Despite all of the political debate regarding the state of HBOS before the merger, there is no doubt that the operation could not have gone on as it was. Did the UK government abuse its power over the banking system, at a critical time, or did Lloyds bank grab the opportunity to acquire a major competitor at a knockdown price?
Whatever the situation, there is no doubt that the merger of Lloyds bank and HBOS, at least so far, has been one of the worst corporate mergers in living history.
Share this..
Related stories
High Street Sales Are Struggling
Those who thought that May's spending growth on the high street was set to continue for some time will be sadly disappointed with news that like for like retail sales in June were down some 0.4%. While not a large drop, it seems as though finally the tightening of budgets and lack of credit is starting to register with many consumers. While the May figure was something of a blip in the overall p...
Read MoreFSA to release paper on banking regulation
The Financial Services Authority (FSA) will this week release its much awaited paper regarding the future regulation of the UK banking industry. This comes just hours after a spat between the UK government and the Bank of England regarding the potential splitting of UK banks into risky and less risky operations.
The highlight of the forthcoming paper will be the focus on "Banks deem...
Graduates on the government's tax hit list
Vince Cable will today set out plans for a so-called graduate tax with hopes that this will dispel some fears over the potential increase in tuition fees. Under the current system graduates are loaned money by the UK government which is a repaid at a later date when they are in employment. However, this repayment system takes no account of a graduates income in the future although under Vince Cabl...
Read MoreLiberal Democrats set to attack David Cameron
The Liberal Democrat party conference is nearly upon us and already it seems that the third strongest party in the UK has discounted Labour and is now set to attack David Cameron as a "con artist". In a damning indictment of Gordon Brown's authority, the Liberal Democrats believe that Labour is a dying party and infighting could well be enough to end their chance of victory at the next election.
ECB Claim The Credit Crunch Is Far From Over
In line with the governor of the Bank of England, Jean-Claude Trichet, the president of the European Central Bank, has gone on record with his view that the credit crunch is far from over and European Central Banks still need to be wary of the risks to long term economic growth. Trichet believes that too many of his European counterparts are obsessed with reducing interest rates to refloat th...
Read More