It appears that the proposed takeover of HBOS by rival bank Lloyds TSB is in danger of causing more problems than it sought to solve. Shares in HBOS fell in this mornings trading by 11.5% and Lloyds by 7.1% as experts realised that a merger would not solve the underlying problems of HBOS supposed under funding and a fall of 64% in mortgage lending compared to a year ago.
There are real fears that the merger would shift worries about HBOS funding to a larger bank.
There are also concerns being shown over the US Government’s bail out for it’s banks, with financial experts in the USA suggesting that the plan had not been thought through properly.
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