THE final curtain has fallen on HBOS and the spotlight turns on Sir Victor Blank and Eric Daniels, not exactly the Chuckle Brothers of the sector, to deliver their routine to the war-weary banking sector.
With the takeover now safely completed we should hear within weeks, if not days, what the chairman and chief executive have in store for the new Lloyds Banking Group. Expect announcements on the second tier of management appointments and possibly som
e clarification on any assets they consider surplus to requirements or in need of merger, including the retail branch network and parts of its business banking, treasury and insurance operations.
The big one will be jobs. There will be a lot of people leaving the company, but the jury is out on the 40,000 figure that has been bandied about. Let's clear up one thing here: this number was put about by a London newspaper hack at the press conference to announce the deal and was thought to have been a crude calculation based on the numbers that RBS achieved from its takeover of NatWest.
It was immediately described by Blank as "ridiculous". Even so, it hasn't stopped everyone from MSP Alex Neil to the BBC from repeating it at every opportunity and the pressure is on Blank to prove it is an exaggeration.
Aside from him losing that argument, the best hope we've got is that Lloyds manages to reduce the payroll largely through natural wastage. On an average of 9% to 10% leaving voluntarily it can achieve this sort of number from a combined workforce of 144,000 over three years without forcing anyone to go. The reality, of course, is that some will have little choice.
As for the shareholders, neither those in HBOS nor Lloyds TSB have much to be happy about, but the long-term anxieties now rest with the latter. With HBOS issuing a profits warning ahead of Friday's general meeting and likely to reveal sharp losses for at least two years, the downward pressure on Lloyds shares will be immense.
Tough decisions are also required of some of those at the top of the HBOS ladder. What will become of the hugely remunerated Peter Cummings, head of the corporate banking business, who has left the bank creaking under the weight of the billions he lavished on the country's property and retail tycoons? What, indeed, will become of his division now that it is said to be receiving interest from the US?
As this column has argued throughout this saga, the takeover was inevitable. While it was laudable to seek an alternative bidder who may have offered better terms, nobody produced the money required to prop up a bank that was on its knees and begging for its life. Meanwhile, the political debate plummeted to ill-informed and xenophobic depths that did Scotland no favours. This was not a battle over the union. Nor was it a battle over Bank of Scotland's independence: that was lost in 2001 when it merged with Halifax. The truth is that The Mound was the headquarters of the Bank of Scotland division of HBOS, but the real seat of power in the HBOS group was Old Broad Street, London.
The tie-up with Lloyds is a sad ending to a 300-year-old story but it does give Scottish banking a chance to regain its strength.
Competition issues do remain, though Scotland has been largely in the grip of the Bank of Scotland/RBS axis for some years. If Lloyds is deemed to have too much control it is possible, even probable, that in due course there will be an inquiry by the competition authorities. An inquiry into the whole banking crisis must surely be on the cards anyway once the sector is back on an even keel.
As for the nationalists and others who opposed the deal, they would be wise to see that the real alternative to Lloyds TSB was the complete failure of HBOS.
Those desperate for a Scottish solution were even blinkered to the Scottishness of the Lloyds tie-up: not least its TSB roots which were largely overlooked, its Scottish Widows subsidiary and the emergence of its Scottish chief executive Archie Kane – as first predicted here – as the new bank's Scottish supremo. Lloyds said from the outset that The Mound would remain its Scottish headquarters, though to give credit where it is due, the campaigners may have helped secure a greater commitment to Scotland than would otherwise have been the case.
While we await the ramifications of this deal in the new year it is worth a wager that, in time, Edinburgh may even emerge stronger than hitherto.
After all, superbanks have a habit of being powerful and influential.
