HBOS
 | This article documents a current event. Information may change rapidly as the event progresses, and initial news reports may be unreliable. The latest updates to this article may not reflect the most current information. (September 2008) |
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| Company type | Public (LSE: HBOS) |
|---|---|
| Industry | Finance and Insurance |
| Founded | 2001 |
| Headquarters | Edinburgh, Scotland, UK |
Key people | Dennis Stevenson, Chairman Andy Hornby, CEO |
| Products | Financial Services |
| Revenue | £21,291 million (2007) |
| £5,149 million (2007) | |
| £4,109 million (2007) | |
Number of employees | 72,000 |
| Website | www.hbosplc.com |
HBOS plc (LSE: HBOS) (Halifax Bank of Scotland) is a banking and insurance group in the United Kingdom, the holding company for Bank of Scotland plc, which operates the Bank of Scotland and Halifax brands; HBOS Australia, owner of BankWest; and HBOS Insurance & Investment Group Limited, the group's insurance division. Although officially HBOS is not an abbreviation with any intrinsic meaning, it is widely recognised as an initialism for Halifax Bank of Scotland. The corporate headquarters of the group are in Edinburgh, Scotland; the old office of the Bank of Scotland. Operational headquarters are based in Halifax, West Yorkshire, England; the old head office of Halifax.[1]
HBOS was formed by the merger of the Halifax plc and the Governor and Company of the Bank of Scotland,[2] and the formation of HBOS was heralded as creating a fifth force in British banking as it created a company of comparable size and stature to the established Big Four UK retail banks. It is also the UK’s largest mortgage lender.[3] HBOS is a public limited company listed on the London Stock Exchange (LSE: HBOS). A reorganisation of the group initiated by the HBOS Group Reorganisation Act 2006 saw the transfer of the Halifax plc to the Governor and Company of the Bank of Scotland, which was now a registered public limited company, Bank of Scotland plc.
History
Formation
The Bank of Scotland is the UK's oldest commercial bank, by an Act of the Parliament of Scotland in 1695. Halifax was founded in 1853 as the Halifax Permanent Benefit Building and Investment Society, which demutualised in 1997 to become a plc.[4]
The merger of the Bank of Scotland and Halifax occurred in 2001[2] during a wave of consolidation in the UK banking market which began in the late 1990s. The Bank of Scotland played a key role in the process, firstly by launching a hostile takeover bid for NatWest, although the bid failed to a rival offer from the Royal Bank of Scotland. It later investigated a merger with Abbey National, when Halifax approached with an offer to merge.
The merger created the fifth largest bank in the UK by market capitalisation.
HBOS Group Reorganisation Act 2006
In 2006, HBOS secured the passing of the HBOS Group Reorganisation Act 2006, a private Act of Parliament that would allow the group to operate in a more simplified structure.[5] The Act allowed HBOS to make the Governor and Company of the Bank of Scotland a public limited company, Bank of Scotland plc, which became the principal banking subsidiary of HBOS. Halifax plc transferred to Bank of Scotland plc, although the brand name has been retained.
The provisions in the Act were implemented on 17 September 2007.
2008 Credit Crunch
Along with many other financial institutions HBOS' share price suffered a steep decline following the demise of Lehman Brothers, but the group moved quickly to make assurances as to its liquidity and stability.
On September 17 the BBC reported that HBOS was in merger talks with Lloyds TSB, but there has yet to be any official statement from the bank.[1]
Operations
HBOS conducts all its operations through three main businesses:
- Bank of Scotland plc
- HBOS Australia
- HBOS Insurance & Investment Group Limited
Bank of Scotland plc
Bank of Scotland plc is the banking division of the HBOS group, and operates the following brands:
United Kingdom
- Bank of Scotland
- Bank of Scotland Private Banking
- Bank of Scotland Treasury Services
- Birmingham Midshires
- Halifax
- Halifax Financial Services (Holdings) Ltd
- Halifax Investment Fund Managers Ltd
- Halifax Share Dealing Limited
- Halifax Unit Trust Management Ltd
- Intelligent Finance
- Sainsbury's Bank (50%)
- The Mortgage Business (TMB)
- Blair, Oliver & Scott (Debt recovery)
- St James's Place Bank
International
- Banco Halifax Hispania
- Bank of Scotland Corporate
- Bank of Scotland International
- Bank of Scotland Investment Services
- Bank of Scotland (Ireland)
- Bank of Scotland (Netherlands)
HBOS Australia
HBOS Australia was formed in 2004 to consolidate the group’s holdings in Australia. It consists of the following subsidiaries:
- Bank of Western Australia Limited
- Capital Finance Australia Limited
- St Andrew's Australia Pty Ltd
- BOS International (Australia) Ltd
HBOS Insurance & Investment Group Limited
HBOS Insurance & Investment Group Limited manages the group’s insurance and investment brands in the UK and Europe. It consists of the following:
- esure
- First Alternative
- St James's Place Capital (60%)
- Halifax General Insurance Services Ltd
- Halifax Insurance Ireland Ltd
- Clerical Medical
- AA
- Sainsbury's
- Sheilas' Wheels
References
- ^ "Bank of Scotland, Halifax tie knot". All Business. Retrieved 2007-07-02.
- ^ a b HBOS: the issue explainedGuardian, 2001
- ^ HBOS is the largest mortgage lender in the Isles
- ^ Halifax could have another £3bn to hand out
- ^ HBOS Group Reorganisation Act 2006
