Shareholders support bank merger

Shareholders at BoS supported the merger

Bank of Scotland shareholders have voted overwhelmingly in favour of a £29bn merger with the Halifax.

At an extraordinary general meeting in Edinburgh, shareholders voted by just over 99% in favour of the deal.

The Bank of Scotland (BoS) vote came as little surprise and shareholders of its would-be partner will cast their votes on Wednesday.

BoS announced its plans to merge with Halifax in May and last week the UK Government gave it the green light.

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The Edinburgh bank's governor, Sir John Shaw said the tie up would herald "a new chapter" in its 306-year history.

He said: "This is a defining moment in the Bank of Scotland's long and successful history, but it is by no means the final chapter.

"It opens a new chapter in the continuing story of the progress of the bank as a major British bank headquarters here in Edinburgh."

At the beginning of the meeting, attended by around 300 people, Sir John said he hoped they would give their approval to the deal.

"I believe that the combination of our businesses with those of Halifax provides a distinctive new force in UK banking which will deliver value, choice and convenience for customers."

Equal opportunities

He also said he welcomed the decision by the Trade Secretary Patricia Hewitt not to refer the merger to the Monopolies Commission.

During the EGM, one shareholder asked Sir John whether the BoS board would consider any further bids for its business before the Halifax merger was rubber-stamped.

Sir John said the board was duty-bound to consider all proposals made to it, but admitted it was highly unlikely any other institution would attempt to strike a deal with the bank so close to the completion of the Halifax deal.

HBOS will be based in Edinburgh

Another shareholder pointed out that of the nine board members of the Halifax three were in their 30s and a further three were in their 40s and asked why the youngest members of the BoS board was in their 50s.

But Sir John said an equal opportunities policy was in place and said suitable board candidates were appointed regardless of age.

After the meeting shareholders expressed satisfaction at the outcome and said they were sure the future of the bank was secure.

James Cameron of Aberdeen said: "I think both organisations will benefit from it.

"I just hope that the Halifax shareholders give the same level of support as the Bank of Scotland shareholders did today.

"It is the end of an era, but I think it will also be a bright future."

'Best brains'

John Macrae, from Edinburgh, said: "I think the amalgamation between the Halifax and the Bank of Scotland will be a good thing and a great success.

"You've got to have the best brains on board to succeed these days and now we've got a very knowledgeable team who I think will do a good job for us."

HBOS is expected to begin trading on 10 September following the approval of the courts in England and Scotland.

It is expected to be the fifth major player in the UK and will have its headquarters in Edinburgh - with its corporate and business banking operations also based there.

It will have a staff of 55,180 and a combined market value of £28.4bn.

However, about 2,000 people are expected to lose their jobs as a result of the merger.