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Friday, 4 May, 2001, 09:53 GMT 10:53 UK
'A merger of equals'

The proposed 28bn merger between the Bank of Scotland and the Halifax will create Britain's fifth largest bank.

BoS managing director Gavin Masterton - who retires on 15 June after 45 years in the industry - spoke to BBC News Online Scotland about the deal.

The merger today is a culmination of a series of dialogues we have been having with the Halifax over a passage of time.

I think it is good news for the Bank of Scotland and the Halifax.

It brings together two enormously strong companies, but it is two banks that have two very different strengths.

Halifax is the number one on mortgages and savings schemes.

The end result is a very palatable fit - the result will be that we will become more efficient

The Bank of Scotland has made its mark in our corporate lending, in our support of small businesses and in our treasury operations.

So when you put these two companies together you create an organisation that is very substantial - the 11th largest on the FTSE 100 index.

It becomes the fifth largest force in banking in the UK, but interestingly enough it is a high growth scenario and I am sure that the combination will result in an enhancement of market share in the year ahead.

It is very much a merger of equals.

The end result is a very palatable fit - the result will be that we will become more efficient.

There will be some cutbacks rather than redundancies, because over three years we are talking about job reductions of about 2,000.

It should be borne in mind that a large organisation will employ something like 52,000 people and in every four months of each year we require to recruit in excess of 2,000 people to replace natural wastage.

It is not a question of redundancies, it is a question of taking our foot off the recruitment accelerator for a while.

It is a very strong, exciting force in banking for Scotland, headquartered in Scotland - which is a big plus for us - and we look forward with an awful lot of interest to the years ahead.

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See also:

01 May 01 | Business
Halifax upbeat on trade
23 Feb 01 | Business
Lloyds TSB bid under scrutiny
25 Apr 01 | Business
Q&A: The Halifax - BoS merger
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