When I was writing my book, Black Horse Ride, on the Lloyds takeover of HBOS three years ago, I talked to many of the senior executives of both banks on an unattributable basis, and also had access to a lot of the papers presented to HBOS's board in those fateful days of September/October 2008 when the controversial deal was done.
For the past two weeks, those same executives have been defending themselves in the London High Court against a £550 million (Dh2.6bn) action brought by 5,500 angry Lloyds shareholders who claim they were never told of the parlous state of HBOS. The former executives fiercely deny the allegations, calling them “flawed at every level”, but are facing some pretty tough questioning by skilled lawyers who are delving into every nook and cranny of the deal.
Tim Tookey, former finance director at Lloyds, was first up last week, ably holding his own with the help of the detailed notes he incessantly scribbled in a notepad, and which he seems somehow to be able to find – and interpret – nearly a decade later.
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This week it was the turn of Eric Daniels, the American-born former Lloyds chief executive, who was until the merger, regarded as probably the most conservative banker in Britain. Alone among the big banks, Mr Daniels had kept Lloyds well clear of the sub-prime debacle and wild corporate lending which led to the bankruptcy of Lehman and the fall of RBS and so many others. Why then, he was asked, did he insist on going ahead with the takeover of HBOS, which was on the brink of declaring itself bust?
Before going ahead with the deal, Mr Daniels responded in his taciturn, measured way, he had carefully thought about the risks as well as the benefits – and the benefits won. "We would do it only for the benefit of shareholders. We are not a charitable organisation. We have a charitable foundation for that."
There was, he added, “real value in HBOS. It depended on what we paid for it.”
The shareholders complain he shouldn’t have paid anything at all, which with the benefit of hindsight may be right. But that’s a judgement call and Mr Daniels and the others are not being accused of bad judgement, but of not revealing all they should have done to shareholders.
On the basis of my interviews and the papers I saw, I think they actually disclosed just about everything they knew. It was what they didn’t know that sunk them. Before the deal, Lloyds reckoned on writing off some £10bn of HBOS’s debts, and in the event had to take a hit of over £50bn.
Lawyers for the shareholders have been particularly keen to get to the bottom of the role played by Gordon Brown, the UK’s prime minister at the time, who personally intervened to allow the merger, which otherwise would never have been passed by the competition authorities.
At a now legendary cocktail party on September 15, 2008, the day after Lehman spectacularly failed, Mr Brown took aside the Lloyds chairman, Sir Victor Blank, and whispered something in his ear. Two days later, Lloyds announced it was taking over HBOS which, without being bailed out, would not have survived to the end of the week.
The implication, put to
Mr Daniels on Monday, was that the prime minister had basically strong-armed the Lloyds chairman into doing the deal. The only alternative, which could have sunk the Mr Brown government, would have been nationalising HBOS, which held the
savings of over 5 million British citizens.
Mr Blank himself will be in court over the next few days to give his own version of these events but I don’t expect him to be critical of Mr Brown’s role. The truth, as both Mr Daniels and Mr Tookey have now confirmed publicly for the first time, is that Lloyds had wanted to do the deal for some time, couldn’t get it past the competition authorities, and believed that the financial crisis would provide them with their only window of opportunity.
Several months earlier Mr Blank had asked Mr Brown to intervene and the prime minister sought the advice of both the Bank of England and the Financial Services Authority.
It was only when Lehman went down and the whole British banking system faced collapse, that he agreed. That was the news he passed on to Mr Blank at the cocktail party that evening.
The other issue which both Mr Tookey and Mr Daniels were asked about, and which will come up again when the former FSA chief executive Hector Sants gives his evidence, is the £7bn of new capital Barclays raised at the time, much of it from Qatari sources. Mr Brown required every bank to raise new capital that week-end and the government stood by to provide it – which it did for Lloyds, HBOS and RBS. Barclays got off the hook by finding it itself – and its chief executive and various other directors now face criminal charges as a result.
The Lloyds directors still seethe over that. In his witness statement Mr Tookey said that he was reassured by financial regulators that all the banks including Barclays were present for emergency funding talks so Lloyds was not singled out, or “stigmatised”.
Mr Daniels says he would not have not gone through with the HBOS deal if he had known Barclays was not also in the government net.
Former Barclays directors including former chief executive John Varley, now facing criminal charges for their role in the fundraising, must now wish they had taken the easier option.
Ivan Fallon is a former business editor of The Sunday Times
The Mandalorian season 3 episode 1
Director: Rick Famuyiwa
Stars: Pedro Pascal and Katee Sackhoff
Rating: 4/5
KEY DATES IN AMAZON'S HISTORY
July 5, 1994: Jeff Bezos founds Cadabra Inc, which would later be renamed to Amazon.com, because his lawyer misheard the name as 'cadaver'. In its earliest days, the bookstore operated out of a rented garage in Bellevue, Washington
July 16, 1995: Amazon formally opens as an online bookseller. Fluid Concepts and Creative Analogies: Computer Models of the Fundamental Mechanisms of Thought becomes the first item sold on Amazon
1997: Amazon goes public at $18 a share, which has grown about 1,000 per cent at present. Its highest closing price was $197.85 on June 27, 2024
1998: Amazon acquires IMDb, its first major acquisition. It also starts selling CDs and DVDs
2000: Amazon Marketplace opens, allowing people to sell items on the website
2002: Amazon forms what would become Amazon Web Services, opening the Amazon.com platform to all developers. The cloud unit would follow in 2006
2003: Amazon turns in an annual profit of $75 million, the first time it ended a year in the black
2005: Amazon Prime is introduced, its first-ever subscription service that offered US customers free two-day shipping for $79 a year
2006: Amazon Unbox is unveiled, the company's video service that would later morph into Amazon Instant Video and, ultimately, Amazon Video
2007: Amazon's first hardware product, the Kindle e-reader, is introduced; the Fire TV and Fire Phone would come in 2014. Grocery service Amazon Fresh is also started
2009: Amazon introduces Amazon Basics, its in-house label for a variety of products
2010: The foundations for Amazon Studios were laid. Its first original streaming content debuted in 2013
2011: The Amazon Appstore for Google's Android is launched. It is still unavailable on Apple's iOS
2014: The Amazon Echo is launched, a speaker that acts as a personal digital assistant powered by Alexa
2017: Amazon acquires Whole Foods for $13.7 billion, its biggest acquisition
2018: Amazon's market cap briefly crosses the $1 trillion mark, making it, at the time, only the third company to achieve that milestone
Kill
Director: Nikhil Nagesh Bhat
Starring: Lakshya, Tanya Maniktala, Ashish Vidyarthi, Harsh Chhaya, Raghav Juyal
Rating: 4.5/5
ESSENTIALS
The flights
Emirates flies from Dubai to Phnom Penh via Yangon from Dh2,700 return including taxes. Cambodia Bayon Airlines and Cambodia Angkor Air offer return flights from Phnom Penh to Siem Reap from Dh250 return including taxes. The flight takes about 45 minutes.
The hotels
Rooms at the Raffles Le Royal in Phnom Penh cost from $225 (Dh826) per night including taxes. Rooms at the Grand Hotel d'Angkor cost from $261 (Dh960) per night including taxes.
The tours
A cyclo architecture tour of Phnom Penh costs from $20 (Dh75) per person for about three hours, with Khmer Architecture Tours. Tailor-made tours of all of Cambodia, or sites like Angkor alone, can be arranged by About Asia Travel. Emirates Holidays also offers packages.
The specs
Engine: 3.9-litre twin-turbo V8
Power: 620hp from 5,750-7,500rpm
Torque: 760Nm from 3,000-5,750rpm
Transmission: Eight-speed dual-clutch auto
On sale: Now
Price: From Dh1.05 million ($286,000)
The specs: Rolls-Royce Cullinan
Price, base: Dh1 million (estimate)
Engine: 6.75-litre twin-turbo V12
Transmission: Eight-speed automatic
Power: 563hp @ 5,000rpm
Torque: 850Nm @ 1,600rpm
Fuel economy, combined: 15L / 100km
SPEC SHEET: NOTHING PHONE (2a)
Display: 6.7” flexible Amoled, 2412 x 1080, 394ppi, 120Hz, Corning Gorilla Glass 5
Processor: MediaTek Dimensity 7200 Pro, 4nm, octa-core
Memory: 8/12GB
Capacity: 128/256GB
Platform: Android 14, Nothing OS 2.5
Main camera: Dual 50MP main, f/1.88 + 50MP ultra-wide, f/2.2; OIS, EIS, auto-focus, ultra XDR, night mode
Main camera video: 4K @ 30fps, full-HD @ 60fps; slo-mo full-HD at 120fps
Front camera: 32MP wide, f/2.2
Battery: 5000mAh; 50% in 30 mins w/ 45w charger
Connectivity: Wi-Fi, Bluetooth 5.3, NFC (Google Pay)
Biometrics: Fingerprint, face unlock
I/O: USB-C
Durability: IP54, limited protection from water/dust
Cards: Dual-nano SIM
Colours: Black, milk, white
In the box: Nothing Phone (2a), USB-C-to-USB-C cable, pre-applied screen protector, SIM tray ejector tool
Price (UAE): Dh1,199 (8GB/128GB) / Dh1,399 (12GB/256GB)
India squads
Test squad against Afghanistan: Rahane (c), Dhawan, Vijay, Rahul, Pujara, Karun, Saha, Ashwin, Jadeja, Kuldeep, Umesh, Shami, Pandya, Ishant, Thakur.
T20 squad against Ireland and England: Kohli (c), Dhawan, Rohit, Rahul, Raina, Pandey, Dhoni, Karthik, Chahal, Kuldeep, Sundar, Bhuvneshwar, Bumrah, Pandya, Kaul, Umesh.
ODI squad against England: Kohli (c), Dhawan, Rohit, Rahul, Shreyas, Rayudu, Dhoni, Karthik, Chahal, Kuldeep, Sundar, Bhuvneshwar, Bumrah, Pandya, Kaul, Umesh
SPEC SHEET: SAMSUNG GALAXY S24 ULTRA
Display: 6.8" quad-HD+ dynamic Amoled 2X, 3120 x 1440, 505ppi, HDR10+, 120Hz
Processor: 4nm Qualcomm Snapdragon 8 Gen 3, 64-bit octa-core
Memory: 12GB RAM
Storage: 256/512GB / 1TB
Platform: Android 14, One UI 6.1
Main camera: quad 200MP wide f/1.7 + 50MP periscope telephoto f/3.4 with 5x optical/10x optical quality zoom + 10MP telephoto 2.4 with 3x optical zoom + 12MP ultra-wide f/2.2; 100x Space Zoom; auto HDR, expert RAW
Video: 8K@24/30fps, 4K@30/60/120fps, full-HD@30/60/240fps, full-HD super slo-mo@960fps
Front camera: 12MP f/2.2
Battery: 5000mAh, fast wireless charging 2.0, Wireless PowerShare
Connectivity: 5G, Wi-Fi, Bluetooth 5.3, NFC
I/O: USB-C; built-in Galaxy S Pen
Durability: IP68, up to 1.5m of freshwater up to 30 minutes; dust-resistant
SIM: Nano + nano / nano + eSIM / dual eSIM (varies in different markets)
Colours: Titanium black, titanium grey, titanium violet, titanium yellow
In the box: Galaxy S24 Ultra, USB-C-to-C cable
Price: Dh5,099 for 256GB, Dh5,599 for 512GB, Dh6,599 for 1TB
COMPANY PROFILE
Company: Eco Way
Started: December 2023
Founder: Ivan Kroshnyi
Based: Dubai, UAE
Industry: Electric vehicles
Investors: Bootstrapped with undisclosed funding. Looking to raise funds from outside
LEADERBOARD
-19 T Fleetwood (Eng); -18 R McIlroy (NI), T Lawrence (SA); -16 J Smith; -15 F Molinari (Ita); -14 Z Lombard (SA), S Crocker (US)
Selected: -11 A Meronk (Pol); -10 E Ferguson (Sco); -8 R Fox (NZ) -7 L Donald (Eng); -5 T McKibbin (NI), N Hoejgaard (Den)
Safety 'top priority' for rival hyperloop company
The chief operating officer of Hyperloop Transportation Technologies, Andres de Leon, said his company's hyperloop technology is “ready” and safe.
He said the company prioritised safety throughout its development and, last year, Munich Re, one of the world's largest reinsurance companies, announced it was ready to insure their technology.
“Our levitation, propulsion, and vacuum technology have all been developed [...] over several decades and have been deployed and tested at full scale,” he said in a statement to The National.
“Only once the system has been certified and approved will it move people,” he said.
HyperloopTT has begun designing and engineering processes for its Abu Dhabi projects and hopes to break ground soon.
With no delivery date yet announced, Mr de Leon said timelines had to be considered carefully, as government approval, permits, and regulations could create necessary delays.
MATCH INFO
Red Star Belgrade v Tottenham Hotspur, midnight (Thursday), UAE
Confirmed bouts (more to be added)
Cory Sandhagen v Umar Nurmagomedov
Nick Diaz v Vicente Luque
Michael Chiesa v Tony Ferguson
Deiveson Figueiredo v Marlon Vera
Mackenzie Dern v Loopy Godinez
Tickets for the August 3 Fight Night, held in partnership with the Department of Culture and Tourism Abu Dhabi, went on sale earlier this month, through www.etihadarena.ae and www.ticketmaster.ae.
The five pillars of Islam
2.0
Director: S Shankar
Producer: Lyca Productions; presented by Dharma Films
Cast: Rajnikanth, Akshay Kumar, Amy Jackson, Sudhanshu Pandey
Rating: 3.5/5 stars
Dr Graham's three goals
Short term
Establish logistics and systems needed to globally deploy vaccines
Intermediate term
Build biomedical workforces in low- and middle-income nations
Long term
A prototype pathogen approach for pandemic preparedness
The Details
Article 15
Produced by: Carnival Cinemas, Zee Studios
Directed by: Anubhav Sinha
Starring: Ayushmann Khurrana, Kumud Mishra, Manoj Pahwa, Sayani Gupta, Zeeshan Ayyub
Our rating: 4/5
SPEC SHEET: APPLE IPAD (2022)
Display: 10.9-inch Liquid Retina IPS LCD, 2,360 x 1,640, 264ppi, wide colour, True Tone, Apple Pencil 1 support
Chip: Apple A14 Bionic, 6-core CPU, 4-core GPU, 16-core Neural Engine
Storage: 64GB/256GB
Platform: iPadOS 16
Main camera: 12-megapixel wide, f/1.8, 5x digital, Smart HDR 3
Video: 4K @ 24/25/30/60fps, full HD @ 25/30/60fps, slo-mo @ 120/240fps
Front camera: 12MP ultra-wide, f/2.4, 2x, Smart HDR 3, Centre Stage; full HD @ 25/30/60fps
Audio: Stereo speakers
Biometrics: Touch ID
I/O: USB-C, smart connector (for folio/keyboard)
Battery: Up to 10 hours on Wi-Fi; up to 9 hours on cellular
Finish: Blue, pink, silver, yellow
In the box: iPad, USB-C-to-USB-C cable, 20W power adapter
Price: Wi-Fi — Dh1,849 (64GB) / Dh2,449 (256GB); cellular — Dh2,449 (64GB) / Dh3,049 (256GB)
Company Profile
Company name: Cargoz
Date started: January 2022
Founders: Premlal Pullisserry and Lijo Antony
Based: Dubai
Number of staff: 30
Investment stage: Seed
UAE currency: the story behind the money in your pockets