Inquiry call over HBOS/Lloyds merger

Published on Wednesday 13 May 2009 22:05

AN MSP called last night for an independent public inquiry into the takeover of HBOS by Lloyds TSB.

Margo MacDonald, the independent MSP for the Lothians, said she had received evidence through freedom of information that senior ministers had been warned not to allow the merger to go ahead. She wants the inquiry to focus on the decisions of Prime Minister Gordon Brown, Chancellor Alistair Darling and Business Secretary Lord Mandelson.

Their decision to waive competition rules was crucial – it is still not clear whether the merger was really needed or if HBOS could have simply been nationalised.

The deal effectively ended 300 years of history of the Bank of Scotland and put thousands of jobs at risk.

Ms MacDonald told MSPs: "Due to redaction of information that failed the public interest test, there are hints rather than proved facts that shareholders were not fully appraised of the real measurement of the soundness of both banks and the plea for caution by, among others, the Office of Fair Trade."