Wednesday, 11 June 2008

HBOS down 11 percent

I have just got to stop it. Looking at the HBOS share price is like watching a train wreck. Today, it is down 11 percent already. Another week of 30p price drops and the bank will be worthless.

More worryingly for the FSA, the Bank of England and the underwriters, the share price fell below the price of its ₤4 billion rights offer.

The share price collapse looks a lot like panic.


VADO said...

panic on the streets of london. We are about to see NRK V2. One week to boe bailout.

Anonymous said...

HBOS - a takeover candidate?

Anonymous said...

I'd take over their book if I could cherry pick. Not so sure about lock stock.

One thing that hasn't surfaced in the UK yet is liabilities. Specifically, what happens when no-win no-fee lawyers start persuading borrowers there was predatory lending and someone else can be sued to cover mortgage repayments.

That's the single biggest thing holding up BoA's acquisition of Countrywide, and we'll soon see it exported to the UK courts.

2009 is shaping up to be a great year for trial lawyers.


aSteve said...

The curious thing about both HBOS and B&B is that they've been major BTL players.

It couldn't go wrong for a more deserving bunch.

Edward Harrison said...

@anonymous about takeover of HBOS:

I saw a blurb in yesterday's FT about bank takeover's here's the URL:

The gist of it is there needs to be more M&A in the European banking sector. I think banks are scared to buy because they don't know how much they will write off or what they'll get in a takeover.

The article says:

Yet in spite of the bargains most banks say they have little interest in large acquisitions, claiming to be happy with their existing business models and strategies. That is delusional for quite a number of banks and just lazy thinking for others. For well-capitalised banks such as UBS, now is a perfect time to consider acquisitions as part of a more general restructuring.

On a side note, financial stocks are way down here in the US. Mortgage lenders are also way down. I do think the 2nd leg down has started.

Anonymous said...

Things do appear to have suddenly got a lot worse this week. It makes me wonder what could have caused all this shareholder panic. I half expect some really nasty announcement in the next few days. Something is definitely happening behind the scenes.


Edward Harrison said...

HBOS has been remarkably absent from huge write-offs in the US. I reckon the Halifax should be top of the list for exposure in the UK. I'm surprised HBOS doesn't try to raise more capital now.