HBOS was “an accident waiting to happen”

<p>A parliamentary report has suggested the bank was being poorly led and would have failed even without the 2008 global financial crisis.</p>

HBOS – the subject of a bailout by the UK government - would likely have collapsed even if the 2008 financial crisis had not occurred, according to ministers.

The Parliamentary Commission on Banking Standards has produced a report labelling the lender an "accident waiting to happen", with poor business decisions made across the company.

According to the report, HBOS was heading towards insolvency even before the funding and liquidity issues that arose from the economic downturn.

The commission stated that, while regulators did not do enough to prevent the collapse, responsibility should lie with the company's chairman Dennis Stevenson and former chief executives Andy Hornby and James Crosby.

Conservative MP Andrew Tyrie chaired the commission and said the situation resulted from a "colossal failure of senior management and the board".

Mr Tyrie also suggested the three men highlighted should be punished by industry regulators. To date, only Peter Cummings – former head of corporate lending at HBOS – has been charged.

He was fined £500,000 by the Financial Services Authority in September and banned from the industry for life.

Learn about the sterling and forex trading at City Index.

Join our live webinars for the latest analysis and trading ideas. Register now

GAIN Capital UK Limited (trading as “City Index”) is an execution-only service provider. This material, whether or not it states any opinions, is for general information purposes only and it does not take into account your personal circumstances or objectives. This material has been prepared using the thoughts and opinions of the author and these may change. However, City Index does not plan to provide further updates to any material once published and it is not under any obligation to keep this material up to date. This material is short term in nature and may only relate to facts and circumstances existing at a specific time or day. Nothing in this material is (or should be considered to be) financial, investment, legal, tax or other advice and no reliance should be placed on it.

No opinion given in this material constitutes a recommendation by City Index or the author that any particular investment, security, transaction or investment strategy is suitable for any specific person. The material has not been prepared in accordance with legal requirements designed to promote the independence of investment research. Although City Index is not specifically prevented from dealing before providing this material, City Index does not seek to take advantage of the material prior to its dissemination. This material is not intended for distribution to, or use by, any person in any country or jurisdiction where such distribution or use would be contrary to local law or regulation.

For further details see our full non-independent research disclaimer and quarterly summary.