Lloyds bank chairman pays the price for HBOS merger
It has been revealed that Lloyds bank chairman Sir Victor Blank will be leaving the company in 2010 after apparently paying the price for the disastrous merger with HBOS. The announcement is expected to be made ahead of next month's annual general meeting which will be dominated by the HBOS merger and the fact the company had to go cap in hand to the UK government for rescue funding.
The decision to step aside has taken away a potentially controversial vote by the UK government, which now owns 43% of the shares in Lloyds bank, as the government would have been forced to vote against shareholder calls for the removal of the chairman. It is worth remembering that the UK government specifically asked Sir Victor Blank to step in and oversee the HBOS merger in an attempt to avert what could have been the largest corporate collapse in UK banking history. As it happens, the merged operation has been fatally flawed as the loan book of HBOS was apparently in a much worse state than first thought.
The fallout from the ongoing banking sector crisis will continue for some time and it will be many months if not years before "normal conditions" return to the sector.
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