Outlook: Banking mergers
Saturday 13 February 1999
With the market itching for a deal, the remarks have been read as a clear signal that Lloyds, now that the integration of TSB is well in hand, is poised to strike - as Sir Brian, one of the most experienced men in the business, surely knew it would.
The question, as always, is where and when, and as far as that goes, Sir Brian was giving few clues, or at least deliberately contradictory ones.
There have been plenty of mergers in the last 18 months. But so far they have all been abroad, while here all we have had is an endless diet of talk and precious little action.
Is that really about to change? Sir Brian and his team have looked at everything both at home and abroad, and so far seen nothing that they particularly like. What they desperately need to make a merger stack up is for some of the weaker players to shed their illusions and resign themselves to their deserved fate. Given the strength of yesterday's results, there is no doubt that in his mind that in the consolidation game he sees Lloyds as being predator rather than prey.
So far the preoccupation within the UK banking sector has been primarily on its own backyard. But the government seems determined to block any mergers which bolster the position of the banks at the expense of the consumer - in other words, precisely the kind that the City wants to see.
Thursday's appointment of an American to head Barclays raises the intriguing possibility of a transatlantic banking deal. Sir Brian for all his talk about how cross-border mergers can destroy value is surely not about to be bested by anyone, even a former US marine.
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