Lloyds buy leaves HBOS techies facing axe - again
'Stuck between rock and hard place'
IT workers at Halifax Bank of Scotland (HBOS) face the job axe again this morning after the UK’s largest mortgage lender was thrown a £12.2bn lifeline from Lloyds TSB.
Reports have suggested that up to 40,000 people at the bank could lose their jobs once the shock merger between the two companies completes.
Lloyds chief executive Eric Daniels - who has spent the past 48 hours banging out a rescue plan for HBOS - was quick to dismiss that number. However, he added that the bank would be looking to save £1bn a year in costs.
HBOS' head of media relations Mark Elliot told The Register that it was “way too early to speculate because everything has happened so fast.” He said there were “all sorts of questions flying around about jobs. But right now we’re stuck between a rock and a hard place.”
Elliot was unable to tell us if more of the 2,000-strong UK-based IT workforce at HBOS, which saw first half profits tumble 72 per cent to £848m in July, could lose their jobs following the merger.
Just last month HBOS said it planned to slash around 100 IT jobs as part of a cost-cutting exercise aimed at reducing duplication between mortgage brands.
As it stands the bank plans to axe up to five per cent of IT employees in what it described in August as a “phased approach”. The cull was expected to complete by the end of the year.
In July HBOS ominously told IT contractor staff to take a 10 per cent pay cut or work out their notice and leave by 10 August. That was a move viewed by many as the first warning sign that the bank was in serious trouble.
Unite deputy general secretary Graham Goddard called for "urgent talks at the highest level with the banks," and added that the union would "not accept any compulsory redundancies as a result of this merger".
He blamed the "corporate greed of large institutions" for bringing "the financial market to its knees. The major job losses in the sector are fundamentally caused by precarious investments and transactions by bankers pursuing large rewards. Staff working in the financial services must not pay the price for corporate greed."
It is understood that the Bank of England, the Financial Services Authority and the Treasury have worked hard behind the scenes to ensure that Lloyds struck a deal with HBOS.
Prime Minister Gordon Brown has reportedly spoken to Lloyds chairman Sir Victor Blank who described the merger as "a unique opportunity to accelerate and extend our strategy and create the UK's leading financial services group." ®
WE HAVE COMPETITION LAWS FOR A REASON
1/3 Of all mortgages and savings in one bank. WTF?
Even the Republicans in America are prepared to use government money to prevent such an situation occuring. The Republicans!!!
This is robbing Peter to pay Paul and will come back to bite us all in the arse, some time after Brown et al are out of power.
That is all.
@still going ahead
It's an odd one, there are a large percentage of HBOS shareholders who also happen to be staff members.
The takeover may be good for lloyds/hbos, the shareholders and the banking sector in general, but, it's not going to be particularly good for the staff. If the shareprice recovers enough before the decision, then a lot of them are likely to vote against it!
Let's not blame the government
Let's do some REAL research and ask ourselves who is really at fault? The greedy boys and girls behind all these dodgy practices (and hefty bonuses on top of wopping salaries) who took the cash and knackered the system??? Doews no-one remember Nick Leeson and other notable cases?? To blame Brown is unfair even to him. OK he didn't regulate but isn't hindsight a wonderful thing?
It was very satisfying to hear City folk bleating about the ban on Short Selling though, just goes to show how much cash there was in it eh? Look up one of the reasons staple foods are so expensive too, it'll be educational;
all these folks making the big money while we, the plebs, end up suffering the consequences....great eh?
@LTSB couldn't bring HBOS in...
HBOS could bring LTSB in though!
HBOS internal systems are all fairly disparate, but held together reasonably well. The majority of HBOS systems are built in-house so there is a fairly good understanding of them. The current systems have brand new .NET stuff playing nicely with 20+ year old assembler systems, so we have a bit of experience getting all these things talking to each other.
There has been a lot of work in the middleware systems over the past few years to make everything properly interoperable, without directly being compatible, and we are currently looking at doing the same thing for client applications.
A lot of HBOS front end systems are currently being re-written as the technology they use is out of support, so there may be an opportunity to unify it all under this. At least make it appear one system to the users while the real consolidation work is done in the background.
Still going ahead?
Given this morning's huge share rallies in the banking sector, will the shareholders (either set) actually approve this now?