Lord Mandelson has warned that Lloyds TSB and HBOS will not get their £17bn rescue package unless the planned merger goes ahead, increasing Government pressure on shareholders to vote in favour of the deal, according to The Telegraph .
The tie-up between Lloyds TSB and HBOS has been thrown into doubt by the steep fall in the share price of both banks this month.
But Lord Mandelson, the new Secretary of State for Business, Enterprise and Regulatory Reform, said the £5.5bn for Lloyds TSB and £11.5bn for HBOS is conditional on the deal.
“The recapitalisation that we've offered is based on the merger of the two banks,” he said. “Recapitalisation is predicated on the merger going ahead.
“If it didn't go ahead that would completely change the proposition, but I haven't heard that they are thinking of demerging before they have come together.”
ALISTAIR DARLING, THE CHANCELLOR, and Lord Mandelson, the Business Secretary, will meet chief executives of Britain's leading banks on Wednesday to urge them to increase small business lending to last year's levels of £53bn, according to The Times.
The move puts the plight of small and medium sized firms at the centre of the Government's economic recovery plan as fears grow for thousands of jobs. Both Labour and the Conservatives are battling to claim the title of saviour of Britain's 4.5 million small businesses which employ almost 14 million people.
Lord Mandelson told MPs on the Commons Business Select Committee that those banks being recapitalised by the Government are obliged to lend to small businesses at last year's level, although he appreciated that they had to take risk into account and that some businesses posed greater risks now than 12 months ago.
The Business Secretary said that he was “very concerned from what I heard last week from representatives of small businesses” in terms of access to finance and higher charges being imposed by banks.
He said some small businesses were being hit by a “double whammy” of having existing loan arrangements rewritten and being charged more for the new finance.
BRITAIN, FRANCE, GERMANY AND A string of leading world economies have pledged to get tough with tax havens, adding more to a black list and drawing up punitive measures for uncooperative countries, reports The Telegraph.
Stephen Timms, Financial Secretary to the Treasury, representing Britain at a gathering to discuss the issue in Paris, said the meeting sent "a very strong signal that time is up for people not paying their taxes".
Mr Timms said Britain would next year repeat an operation conducted in 2006, when it demanded the country's top five banks provide information on their offshore accounts. "We gave people the opportunity to disclose offshore holdings and have so far taken in £400m worth of tax that otherwise would have gone unpaid," he said.
This time the exercise will be extended to more banks – such as former building societies – as well as UK subsidiaries of foreign banks. "I'm pretty confident that this will yield at least as much again," he said.IFAonline
Putting the tech into protection
Square Mile’s series of informal interviews
Fallout from Haywood suspension
Launching later in 2019
£80bn funds under calculation