Huge job losses to follow Lloyds TSB-HBOS deal: Report

LONDON: Thousands of jobs are feared to be at risk after banking major Lloyds TSB completes its 12.2 billion pound acquisition of UK's troubled mortgage lender HBOS, a media report says.

According to UK daily Telegraph, "Thousands of jobs are set to go when Lloyds TSB completes its 12.2 billion pound rescue of HBOS, as the new bank faces Britain's first recession in two decades."

However, the report stated that Lloyds TSB Chief Executive Eric Daniels, had dismissed the rumours of 40,000 job cuts as being too high, although he added that the bank would be seeking to save one billion pound a year in costs.

The deal to save HBOS was chalked out over the past 48 hours against a backdrop of HBOS's tumbling share price. The deal values HBOS at 12.2 billion pound, which is based on Lloyds TSB's closing price on September 17, 279.75 pence, a Lloyds statement had said.

Under the terms of acquisition, shareholders in HBOS would receive 0.83 Lloyds TSB shares for every one HBOS share. Existing Lloyds TSB shareholders would own about 56 per cent of Lloyds TSB as enlarged by the acquisition and existing HBOS shareholders would own around 44 per cent.

Lloyds TSB's Victor Blank and Eric Daniels would be the Chairman and Chief Executive of the enlarged group.
However, Daniels, who is now the most powerful man in British banking, did not say how much staff would go or how many branches would close, the Telegraph report said.

Recently, the Public and Commercial Services Union (PCS), the largest UK union in the IT company EDS had expressed fears that over 3,000 jobs cut could be in Britain as a result of the takeover of the company by Hewlett Packard (HP).
With thousands of jobs to go globally, the union even feared that more than one in five of the UKs 15,000 strong workforce could lose their job.