HBOS rapped over Farepak donation

Banking giant HBOS has been criticised for donating only £2m to Farepak customers after the Christmas hamper and voucher firm collapsed.

HBOS was the banker for European Home Retail, the holding company of Farepak.

A statement released by HBOS reads: “We were not responsible for the collection of monthly savings from Farepak customers, nor did we administer the accounts into which these funds were deposited.

“EHR had a significant loan facility with us. It used most of that most of the time. We have been as supportive as possible of the business. During the period of EHR’s greatest financial difficulty – following the suspension of its shares in August – our financial exposure increased.”

The statement concludes: “We stood by our customer. It is inaccurate to suggest that our exposure to EHR was being reduced.”