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Shareholders have right to be angry

The shocks keep coming. As the City reels from the enormity of HBOS’ losses and the subsequent market reaction that sent Lloyds Banking Group’s shares tumbling surely shareholders are entitled to question what happened to due diligence.

The indecent haste with which this shotgun marriage was nodded through seems to have paid scant attention to the checks and balances that normally accompany such acquisitions.

And while at the time it may have seemed to be in the interests of both the government and the banking sector, didn’t shareholders have a right to expect that their interests should have been better protected?

Sir Fred ‘the Shred’ Goodwin has been the subject of much vilification for apparently accepting as gospel everything that ABM Amro fed to RBS to clinch the deal. But isn’t Lloyds TSB supremo Eric Daniels guilty of ploughing much the same furrow?

There were many warning voices raised when the Treasury overruled the concerns of the Monopolies and Mergers Commission. But now it seems that this was one element of the UK’s compliance and risk control that was singing the right tune.

For a man on such a modest basic salary – a mere £1m – it’s understandable why Daniels may have been distracted by the bonus opportunities afforded from asset-stripping a major competitor.

Unfortunately his shareholders are now dancing to a different tune.


Lib Dems propose no-fee, no-frills mortgage deal

The Liberal Democrats have come up with the idea of a standard five-year fixed ‘no fees, no frills’ mortgage product aimed at providing long-term stability to the market.

Don’t try to to cut corners on compliance

Each February the Financial Services Authority looks at the issues coming up in the year ahead for markets, consumers and firms, and publishes its Financial Risk Outlook.

We must deal with toxic assets issue

It seems governments across the world feel they will be judged by how well they stay ahead of the curve in trying to avoid financial meltdown.

Show me the money – earnings are central to performance in Europe

Equity markets globally currently remain vulnerable to sharp shifts in sentiment caused by either unexpected or unwelcome outcomes in key upcoming political events (the US and German elections, Brexit and the Italian referendum). These top-down influences, combined with the current low global growth environment, will likely lead to broadly directionless markets, and prolong the current low beta return environment. We do, though, […]


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