|low graphics version | feedback | help|
|You are in: UK: Scotland|
Friday, 4 May, 2001, 13:09 GMT 14:09 UK
Thumbs up for bank merger
Business leaders and Scottish politicians have welcomed the news that the Bank of Scotland has agreed a £28bn merger with the Halifax.
The move, which was announced to the stock exchange on Friday morning, is likely to result in the loss of 2,000 jobs as cost savings of £620m are implemented.
Business leaders said it is a step forward for both organisations and political leaders in Scotland have reacted positively.
But banking unions have given a more cautious reaction to the news and said they hoped that there would be no compulsory redundancies despite the expected job losses among both workforces.
Speaking on BBC Radio's Good Morning Scotland programme, Mr Jones said: "I'm actually very pleased for the financial services community in Scotland.
"Edinburgh is clearly, after London, the place in Britain that can lead financial services and indeed it is one of the top ones in Europe.
"Now all this can do is make Bank of Scotland stronger and it can actually make sure that Edinburgh continues its pre-eminent position as a financial services capital.
"That can only be good news for Scotland."
New banking force
Scotland's First Minister Henry McLeish said: "This is a good news story for Scotland. It's based on sound commercial reasons and is creating a new force in British banking.
"Before devolution, people were concerned about a stable, business environment, but what we've got here is a devolution which is pro-business and pro-enterprise and we look forward to more commercial developments in the future.
"I think it augurs well for more investment in our country as a major financial services sector in the whole of Europe.
Mr McLeish added: "Obviously we want to look closely at where these job losses would be, but I have been given every reassurance that there will be discussions with all concerned."
Deputy First Minister Jim Wallace viewed the news that the headquarters would be based in Edinburgh as a vote of confidence in Scotland.
Mr Wallace said: "I think people will be relieved that this hasn't been a long drawn out protracted negotiation and really since the Bank of Scotland lost out to the Royal Bank of Scotland two or three years ago with regard to Nat West there has been uncertainty.
"I think this now allows the Bank of Scotland to look to the future with confidence and I think welcome relief that the headquarters will be in Edinburgh.
"It is worth reflecting that here we are at the mid-point of the Scottish Parliament. Remember the debates before the parliament was established that this would draw away business from Scotland and companies would take their headquarters out of Scotland.
Scottish Conservative Leader David McLetchie said: "I welcome the news that will establish a fifth force in UK banking.
"It's a tribute to the acumen of the highly-regarded management and board of the bank, and will enhance the status of Edinburgh as a leading financial centre in Europe.
"I am glad to note there are no plans for enforced redundancies."
Scottish National Party finance spokesman Andrew Wilson said fact that the headquarters of the new bank will be in Edinburgh was "very good news".
But he added: "However there is a world of difference between a functioning corporate headquarters and a headquarters in name only, so it is vital that the chief executive moves quickly to demonstrate that the dynamic and strategic leadership and direction of the bank is being determined from Edinburgh.
"The new bank needs to show by its actions that not only is its HQ in Edinburgh here to stay, but it will be more than a brass plate.
Edinburgh City Council leader Donald Anderson said: "This is good news for Edinburgh and Scotland, and a great boost for our financial sector.
"I welcome the outcome and look forward to seeing more detail about what this means for the city."
The planned merger was also welcomed by the National Association of Banking Customers.
Spokesman Adrian Graves told BBC Radio's Good Morning Scotland programme: "These two organisations are complimentary in culture and product range and the geographic spread of the two together is pretty complimentary too."
He said that he hoped the planned merger would now proceed to create a "fifth column" capable of challenging "the domination of the old big four".
He added: "That will lead back in time, I'm sure, for the benefit of customers."
"We will be looking for both organisations to demonstrate that this merger will benefit shareholders, customers, communities as well as workers," he said.
Unions said they had not been made aware that any branches would close as a result of the merger.
The new bank, called HBOS, will have its headquarters in Edinburgh, where Bank of Scotland is based, while High Street banking activities will be focused in Halifax itself.
But in a surprise move the two top management posts will be filled with Halifax people.
01 May 01 | Business
Halifax upbeat on trade
30 Mar 01 | Business
Watchdog hears merger protests
06 Mar 01 | Business
Big banks 'operate monopoly'
23 Feb 01 | Business
Lloyds TSB bid under scrutiny
14 Feb 01 | Business
Abbey posts record profits
12 Dec 00 | Business
Abbey rebuffs new Lloyds TSB bid
14 Feb 01 | Business
The battle for Abbey National
25 Apr 01 | Business
Halifax and BoS discuss merger
The BBC is not responsible for the content of external internet sites
Top Scotland stories now:
Links to more Scotland stories are at the foot of the page.
Links to more Scotland stories
|^^ Back to top
News Front Page | World | UK | UK Politics | Business | Sci/Tech | Health | Education | Entertainment | Talking Point | In Depth | AudioVideo
To BBC Sport>> | To BBC Weather>>
© MMIII | News Sources | Privacy