Combined Lloyds TSB and HBOS 'will hold 28 per cent of mortgage market'

Date:Thursday 18th September 2008

A combined Lloyds TSB and Halifax Bank of Scotland (HBOS) operation would hold 28 per cent of the UK mortgage market.

This is according to Bloomberg, covering the widely reported story of the merger.

HBOS lost a significant amount of its market value in the past week due to volatility in global stock exchanges.

According to Bloomberg, the Edinburgh-based HBOS lost half its value.

The Financial Services Authority said the announcement of the merger, which is subject to approval by HBOS shareholders, is a "welcome move" and said it was likely to "enhance stability within financial markets and improve confidence among customers and investors".

In the wake of the news, Moneyfacts has compared key mortgage deals from various lenders.

A spokesperson, noting that any merger would hold nearly 30 per cent of the UK mortgage market, said that Halifax and Cheltenham & Gloucester are both "major and well known brands in the UK".

The spokesperson said it was not likely that these two brands would vanish.

"It is likely that each brand will maintain its presence and serve its own niche within the mortgage market."