David Prosser: Lloyds still can't move beyond the HBOS disaster narrative

Outlook: As for the taxpayer, there can be no disposal of the Lloyds stake until Sir John Vickers' Independent Banking Commission has made its view clear

Poor old Lloyds Banking Group: the miserable news related to its rescue mission for HBOS two-and-a-half years ago just keeps on coming. As if the losses from HBOS's commercial lending activities haven't been disastrous enough, it now turns out that the bank's Halifax business, the country's biggest mortgage lender, wasn't up to the basic job of communicating its interest rates properly to borrowers. The result is a £500m bill for its new owner.

For António Horta-Osório, who takes over as Lloyds chief executive a week today, the sinking feeling will be a new one. For Eric Daniels, the man who he replaces, it has been an all-too familiar sensation – both sets of annual results over which he has presided since the HBOS deal was sealed have been marred by disclosures of its difficulties. His final set of numbers, due on Friday, will be too.

As a result, Mr Daniels is leaving Lloyds well before it becomes clear whether, as he has always argued, the acquisition of HBOS was too good an opportunity to miss.

That argument has had a logic to it: in circumstances other than a financial crisis, Lloyds could never have persuaded the competition authorities to sign off on a takeover of HBOS, such is the market power of the combined entities. Eventually, once the hidden HBOS nasties stop rearing their ugly heads, that power ought to translate into profitability.

The flaw is that Lloyds' power may be diluted before the bank has had the chance to enjoy it. The European Union has already ordered it to sell off 600 UK branches – a disposal that banking analysts say will reduce Lloyds profits by 12 per cent in 2012 – and there is a potential for much worse to come from the Independent Commission on Banking.

Sir John Vickers' review of the industry, expected to conclude in the spring, may yet call for the unwinding of the Lloyds-HBOS deal. One half of Sir John's brief is to investigate how to encourage competition in Britain's retail banking industry. He has already made it clear that recommending the separation of Lloyds-HBOS is not out of the question should he decide competition requires it – as you might expect him to given that the group has a combined market share close to a third on some products.

Where does this leave Lloyds shareholders, including the taxpayer, with its 41 per cent stake? Well, were Sir John to order a break-up of the group, investors would have had to put up with three years of downside from the HBOS deal, only to be deprived of the potential future upside. As for the taxpayer, it is clear there can be no disposal of the stock until Sir John has made his views known.

A better candidate for News Corp top job

It is the sort of concept that, inother circumstances, Shine, the independent television production company, might use as the basis for a compelling docu-drama. Put two siblings on the board of a global media business run by their father and watch them battle it out to succeed him. Maybe viewers should get the casting vote?

News Corp's purchase of Elisabeth Murdoch's Shine – and her promotion to full voting member of the News Corp board – is understandably being viewed through the succession prism. Does Ms Murdoch's return to the fold suggest that James Murdoch now has a fight on his hand to become Rupert Murdoch's anointed heir?

If so, it must be said that James remains in pole position. The growth of Shine has been impressive – sales up 10-fold over the past five years – but Elisabeth's brother's achievements while running BSkyB, a much more expansive role, were just as noteworthy. He has rightly received flak in recent months for failing to get to grips with the phone-hacking scandal since taking charge at News Corp Europe, but the vision he showed in turning Sky from a utility business to genuine growth star was impressive.

Still, there is a better candidate than either James or Elisabeth for the top job at News Corp and he is already working at the company. Step forward Chase Carey, president and chief operating officer of the business (and the man to whom Ms Murdoch will now report), who has a CV that reads far more impressively than that of either sibling in every respect. It takes in a string of successes at News Corp and beyond – one reason, no doubt, why he was invited back to the business two years ago after quitting a few years previously, an unusual step for Rupert Murdoch. What a pity he lacks the one quality most vital to become CEO at News Corp – the right surname.

Last chance to put women on the board

It was good to hear Sheelagh Whittaker, a non-executive director of the insurance giant Standard Life, tell the Today programme yesterday that quotas are the answer to the pathetic failure of large companies to promote more women to their boards. But sadly, while research published yesterday revealed that 47 per cent of women in managerial positions agree with Ms Whittaker, Lord Davies' review on gender equality in the boardroom, due on Thursday, is unlikely to grant her wish. Not least that is because a number of senior women have told him they do not share Ms Whittaker's view.

The better news is that it does now look as if the Davies review will have more bite than we feared. In addition to wishy-washy suggestions about better mentoring of high-flying women to ensure they fulfil their potential – a worthy idea, but one that leaves rather too much to chance – Lord Davies is now expected to set some deadlines within which larger companies will have to hit certain targets.

That's encouraging, assuming there is an explicit understanding that if those targets are not met, discussions about quotas will be reopened. If not, there's no point in having a deadline.

Start your day with The Independent, sign up for daily news emails
ebooksAn introduction to the ground rules of British democracy
Latest stories from i100
Have you tried new the Independent Digital Edition apps?
Independent Dating

By clicking 'Search' you
are agreeing to our
Terms of Use.

iJobs Job Widget
iJobs Money & Business

SThree: Trainee Recruitment Consulant

£20000 - £25000 per annum + competitive: SThree: SThree are a global FTSE 250...

Guru Careers: Financial Controller

£45 - £55k DOE: Guru Careers: A Financial Controller is required to join a suc...

Recruitment Genius: Sales Consultant / Telemarketer - OTE £20,000

£12500 - £20000 per annum: Recruitment Genius: Scotland's leading life insuran...

Recruitment Genius: Sales Adviser - OTE £24,500

£22500 - £24500 per annum: Recruitment Genius: Inbound and outbound calls with...

Day In a Page

Mullah Omar, creator of the Taliban, is dead... for the fourth time

Mullah Omar, creator of the Taliban, is dead... again

I was once told that intelligence services declare their enemies dead to provoke them into popping up their heads and revealing their location, says Robert Fisk
Margaret Attwood on climate change: 'Time is running out for our fragile, Goldilocks planet'

Margaret Attwood on climate change

The author looks back on what she wrote about oil in 2009, and reflects on how the conversation has changed in a mere six years
New Dr Seuss manuscript discovered: What Pet Should I Get? goes on sale this week

New Dr Seuss manuscript discovered

What Pet Should I Get? goes on sale this week
Oculus Rift and the lonely cartoon hedgehog who could become the first ever virtual reality movie star

The cartoon hedgehog leading the way into a whole new reality

Virtual reality is the 'next chapter' of entertainment. Tim Walker gives it a try
Ants have unique ability to switch between individual and collective action, says study

Secrets of ants' teamwork revealed

The insects have an almost unique ability to switch between individual and collective action
Donovan interview: The singer is releasing a greatest hits album to mark his 50th year in folk

Donovan marks his 50th year in folk

The singer tells Nick Duerden about receiving death threats, why the world is 'mentally ill', and how he can write a song about anything, from ecology to crumpets
Let's Race simulator: Ultra-realistic technology recreates thrill of the Formula One circuit

Simulator recreates thrill of F1 circuit

Rory Buckeridge gets behind the wheel and explains how it works
Twitter accused of 'Facebookisation' over plans to overhaul reverse-chronological timeline

Twitter accused of 'Facebookisation'

Facebook exasperates its users by deciding which posts they can and can’t see. So why has Twitter announced plans to do the same?
Jane Birkin asks Hermès to rename bag - but what else could the fashion house call it?

Jane Birkin asks Hermès to rename bag

The star was shocked by a Peta investigation into the exotic skins trade
10 best waterproof mascaras

Whatever the weather: 10 best waterproof mascaras

We found lash-enhancing beauties that won’t budge no matter what you throw at them
Diego Costa biography: Chelsea striker's route to the top - from those who shared his journey

Diego Costa: I go to war. You come with me...

Chelsea's rampaging striker had to fight his way from a poor city in Brazil to life at the top of the Premier League. A new book speaks to those who shared his journey
Ashes 2015: England show the mettle to strike back hard in third Test

England show the mettle to strike back hard in third Test

The biggest problem facing them in Birmingham was the recovery of the zeitgeist that drained so quickly under the weight of Australian runs at Lord's, says Kevin Garside
Women's Open 2015: Charley Hull - 'I know I'm a good golfer but I'm also just a person'

Charley Hull: 'I know I'm a good golfer but I'm also just a person'

British teen keeps her feet on ground ahead of Women's Open
Turkey's conflict with Kurdish guerrillas in Iraq can benefit Isis in Syria

Turkey's conflict with Kurdish guerrillas in Iraq can benefit Isis in Syria

Turkish President Erdogan could benefit politically from the targeting of the PKK, says Patrick Cockburn
Yvette Cooper: Our choice is years of Tory rule under Jeremy Corbyn or a return to a Labour government

Our choice is years of Tory rule under Corbyn or a return to a Labour government

Yvette Cooper urged Labour members to 'get serious' about the next general election rather than become 'a protest movement'