MSP launches bid to buy out Bank of Scotland
Monday 22 September 2008
A bid to raise £6bn to save the Bank of Scotland from being lost within a second merger in seven years is being made by a leading Scottish businessman and a nationalist politician.
The bank became part of HBOS in 2001 when it merged with the Halifax and that company now looks set to merge with Lloyds TSB to avoid becoming a victim of the current chaos in the financial sector.
While that deal is seen by many as a fait accompli, the Scottish National Party MSP Alex Neil and the entrepreneur Jim Spowart, who set up Intelligent Finance, are seeking to bring together Scotland's "banking elders" to make an 11th-hour bid for the institution.
Some of the leading financial lights north of the border, such as the financier Sir Angus Grossart, the former Royal Bank of Scotland chief executive Sir George Mathewson, and the former Bank of Scotland chief executive Sir Peter Burt, are to be invited to a meeting in the next few days to discuss the move.
The plan would see the bank – founded in 1695 and the oldest surviving commercial bank in the UK – become a separate company again and, its backers hope, ensure the survival of thousands of jobs in Scotland.
Mr Neil, an economist and a member of the Scottish Parliament's finance committee, said: "We should try and explore every avenue. If we can muster this group it would be a very strong and diverse body of senior banking knowledge.
"If successful, they could be the custodians of the Bank of Scotland. It would be another chapter in the bank's incredible history." He admitted it would be a "challenge" but said it was worth finding out if there was a willingness to "do the necessary to put a bid together".
Mr Spowart said it was unthinkable to do nothing while the bank in effect went out of existence.
"We've all enjoyed successful careers in banking, which is one of the jewels in Scotland's crown," he said. "It is vital that we do something positive. We can't just sit back and watch the Bank of Scotland disappear."
The Scottish National Party leader, Alex Salmond, Scotland's First Minister, accused the British Government of doing just that.
"No country can insulate itself from mergers and takeovers, but very few countries would so idly stand by and allow their oldest, key financial institution to be left in the position that HBOS was left in last week," he said.
Mr Darling said there had been no request for a loan to help HBOS and "frankly, things were way beyond that". "They needed a permanent commercial resolution and that is what we achieved," he said.
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