Some big breaking news from the world of banking this morning after it looks like there are talks between Halifax Bank Of Scotland (HBOS) and Lloyds TSB to merge, which would create a “super-bank” on the high street.
There are few concrete details at the moment, other than the news appears to have come from a reasonably reliable source, BBC business editor Robert Peston, who broke the original news about Northern Rock going bust.
HBOS shares have been up and down like the proverbial this morning, showing a 50% decline at one point this morning, then recovering once the merger news came out, only to fall again at the time of writing.
Apparently the Treasury and FSA (Financial Services Authority) are encouraging the deal, probably because it will mean they won’t be worried about having to dip their hands in their pockets to prop up another major bank. What HBOS and Lloyds TSB’s competitors will think about it is another matter.
Time will tell whether this deal comes to fruition, obviously we’ll keep you updated once there is more to report.