Difference between revisions of "Halifax Bank of Scotland"

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[[Image:Hbos head office.jpg|right|thumb|HBOS Head Office{{ref|photo}}]]
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[[Image:Hbos head office.jpg|right|thumb|HBOS Head Office]]
  
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Formed from the merger of the [[Halifax Building Society]] and [[Bank of Scotland]] in 2001, and head quartered in Edinburgh, with 22 million customers and assets of over £540 billion{{ref|1}}, HBoS ranks third in the list of Scotland's top 500 companies and is the seventh largest bank in Europe.{{ref|2}} The company employs around 72,000 staff globally and reported a net income in 2006 of £3939 million{{ref|45}}.
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Formed from the merger of the [[Halifax Building Society]] and [[Bank of Scotland]] in 2001, and head quartered in Edinburgh, with 22 million customers and assets of over £540 billion,<ref>HBOS, [http://www.hbosplc.com/abouthbos/home.asp About HBoS], accessed 01 February 2007.</ref> HBOS ranks third in the list of Scotland's top 500 companies and is the seventh largest bank in Europe.<ref>Scottish Enterprise, [http://www.scottish-enterprise.com/sedotcom_home/services_to_business_international/lis/about-scotland/about_scotland-keyfacts.htm About Scotland Keyfacts], accessed 31 January 2007.</ref> The company employs around 72,000 staff globally and reported a net income in 2006 of £3939 million.<ref>Fame Company Information Database, (not available online) accessed 19 April 2007.</ref>
  
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The HBoS is one of the largest commercial sponsors of sport and the arts in Scotland, to the tune of £19.5 million in 2003, and is best known for its sponsorship of the [[Scottish Premier League]]. However this is due to expire at the end of the current 9-year deal in 2007{{ref|46}}.
 
  
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There are four main subsidiaries at HBOS: [[Halifax Plc]], [[The Governor & Company of the Bank of Scotland]], [[HBOS Australia]] and [[HBOS Insurance & Investment Group]]. Australia features highly in the companies expansion plans {{ref|26}}. HBOS lists 594 active companies that they retain a business interests in {{ref|48}}, some of the more well known subsidiaries include: [[Bank of Western Australia Ltd]], BankWest, [[Capital Finance]] and [[St Andrews Insurance]]; and UK companies [[Clerical Medical]], [[Birmingham Midshires]], [[Capital Bank]], [[Godfrey Davis]], [[Lex Vehicle Leasing]], [[Hill Hire Plc]], [[Sainsbury's Bank]], [[BM Solutions]]; [[The Mortgage Business]]; [[Rightmove]]; [[First Alternative]]; [[Esure]]; [[Employee Share Services]]; [[Mentor Professional Services]]; [[St Andrews Group]], [[St James's Place Bank]], [[St James's Place Group]] (formerly known as St James's Place Capital Plc), and of course [[Banco Halifax Hispania]], [[Bank of Scotland (Ireland)]] and [[Bank of Scotland (The Netherlands)]].
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The HBoS is one of the largest commercial sponsors of sport and the arts in Scotland, to the tune of £19.5 million in 2003, and is best known for its sponsorship of the [[Scottish Premier League]]. However this is due to expire at the end of the current 9-year deal in 2007.<ref>BBC News Sport, "[http://news.bbc.co.uk/sport1/hi/football/scot_prem/4835062.stm, Bank to end its SPL sponsorship]," 22 March 2006, accessed 13 January 2011.</ref>
  
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==HBoS investments==
 
  
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Unlike the [[Royal Bank of Scotland]], HBoS is less involved in overseas project finance. Though the expansion of [[HBOS Australia]] appears to be a definate corporate strategy of late. Since 2002 the Bank of Scotland consolidated its position as a leader in PPP/PFI type finance, bringing the first such deal to France as a partner in the construction of a new motorway.{{ref|27}} In 2004 it won a major share in an Australian PFI initiative, another road-building project.{{ref|28}} In 2004 the Bank of Scotland part-funded a £35m PPP/PFI deal with the [[City of Edinburgh Council]] for the [[Edinburgh Schools Partnership]] for the design, construction, financing and operation of 4 schools.{{ref|29}}
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There are four main subsidiaries at HBOS: [[Halifax Plc]], [[The Governor & Company of the Bank of Scotland]], [[HBOS Australia]] and [[HBOS Insurance & Investment Group]]. Australia features highly in the companies expansion plans {{ref|26}}. HBOS lists 594 active companies that they retain a business interests in,<ref>Fraser, Ian, "[http://findarticles.com/p/articles/mi_qn4156/is_20041128/ai_n12592404/ HBOS cultivates Down Under for growth; Having scrapped plans to]," 28 November 2004, ''Sunday Herald'', accessed 13 January 2011.</ref> some of the more well known subsidiaries include: [[Bank of Western Australia Ltd]], BankWest, [[Capital Finance]] and [[St Andrews Insurance]]; and UK companies [[Clerical Medical]], [[Birmingham Midshires]], [[Capital Bank]], [[Godfrey Davis]], [[Lex Vehicle Leasing]], [[Hill Hire Plc]], [[Sainsbury's Bank]], [[BM Solutions]]; [[The Mortgage Business]]; [[Rightmove]]; [[First Alternative]]; [[Esure]]; [[Employee Share Services]]; [[Mentor Professional Services]]; [[St Andrews Group]], [[St James's Place Bank]], [[St James's Place Group]] (formerly known as St James's Place Capital Plc), and of course [[Banco Halifax Hispania]], [[Bank of Scotland (Ireland)]] and [[Bank of Scotland (The Netherlands)]].
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==HBOS investments==
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Unlike the [[Royal Bank of Scotland]], HBoS is less involved in overseas project finance. Though the expansion of [[HBOS Australia]] appears to be a definate corporate strategy of late. Since 2002 the Bank of Scotland consolidated its position as a leader in PPP/PFI type finance, bringing the first such deal to France as a partner in the construction of a new motorway.<ref>HBOS, "[http://web.archive.org/web/20030727180911/http://www.hbosplc.com/media/pressreleases/articles/bos/2002-07-05-02.asp Bank of Scotland Exports UK Lead In PFI/PPP to Europe with Participation in Ground-Breaking €915 Million French Motorway Project]," 05 July 2002, Web Archive 27 July 2003, accessed 13 January 2011.</ref> In 2004 it won a major share in an Australian PFI initiative, another road-building project.<ref>Dey, Iain, "[http://business.scotsman.com/halifaxbankofscotland/HBOS-drives-ahead-with-Australian.2572773.jp HBOS drives ahead with Australian PFI]," 17 October 2004, ''Scotsman'', accessed 13 January 2011.</ref> In 2004 the Bank of Scotland part-funded a £35m PPP/PFI deal with the [[City of Edinburgh Council]] for the [[Edinburgh Schools Partnership]] for the design, construction, financing and operation of 4 schools.<ref>''Scottish Business Insider''.</ref>
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In Glasgow the [[3ED consortium]], involving the [[Miller Group]] construction company, the Halifax bank (now HBoS) and [[Hewlett Packard]] computers, will organise construction and retain operational control of the school buildings for the next 29 years. The city council will rent the buildings from 3ED for an annual fee of £40.5 million, an arrangement that is guaranteed to continue for the next 30 years, allowing 3ED to re-coup £1.2bn. This move had been prepared for by the closure of 9 secondary schools in Glasgow, with a population of 30,000 pupils.
 
In Glasgow the [[3ED consortium]], involving the [[Miller Group]] construction company, the Halifax bank (now HBoS) and [[Hewlett Packard]] computers, will organise construction and retain operational control of the school buildings for the next 29 years. The city council will rent the buildings from 3ED for an annual fee of £40.5 million, an arrangement that is guaranteed to continue for the next 30 years, allowing 3ED to re-coup £1.2bn. This move had been prepared for by the closure of 9 secondary schools in Glasgow, with a population of 30,000 pupils.
  
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HBoS finances [[Wood McKenzie]], a Scottish oil and gas consultancy firm also involved in Caspian oil and gas.{{ref|30}}
 
  
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In 2002 HBoS financed [[Philip Green]]'s take-over of [[Arcadia]], the retail group which owns high street brands such as Topshop, Miss Selfridge, Dorothy Perkins and Burtons.{{ref|31}} No Sweat UK has reported union repression and low wages in this group. Factories in London's Whitechapel producing goods for Arcadia were found to be paying substantially under the minimum wage, and other UK suppliers claimed that the company paid so little that they could not provide better wages or working conditions. In Bombay in 2002 there were reports of intimidation of union members, including harassment, physical assault and reduced work.{{ref|32}} In 2004, Philip Green wrote himself a cheque for 3460 million as a result of profits from Arcadia,{{ref|33}} and the remainder went to HBoS, which holds the other 8% of the company.{{ref|34}}
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HBOS finances [[Wood McKenzie]], a Scottish oil and gas consultancy firm also involved in Caspian oil and gas.<ref>Kievturk, [http://web.archive.org/web/20050214073155/http://kievturk.com/?m=news&page=2&newsid=7 Caspian & Black Sea Oil and Gas Conference 2004 Key Facts], Web Archive 14 February 2005, accessed 13 January 2011.</ref>
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In 2002 HBoS financed [[Philip Green]]'s take-over of [[Arcadia]], the retail group which owns high street brands such as Topshop, Miss Selfridge, Dorothy Perkins and Burtons.<ref>Finch, Julia, "[http://www.guardian.co.uk/business/story/0,,1333029,00.html Green gains £460m in Arcadia]," 22 October 2004, ''The Guardian'', accessed 23 March 2005.</ref> No Sweat UK has reported union repression and low wages in this group. Factories in London's Whitechapel producing goods for Arcadia were found to be paying substantially under the minimum wage, and other UK suppliers claimed that the company paid so little that they could not provide better wages or working conditions. In Bombay in 2002 there were reports of intimidation of union members, including harassment, physical assault and reduced work.<ref>No Sweat, "[http://www.nosweat.org.uk/article.php?sid=468 A Partial Victory for Bed and Bath workers]," accessed 16 March 2005.</ref> In 2004, Philip Green wrote himself a cheque for 3460 million as a result of profits from Arcadia,<ref>Finch, Julia, "[http://www.guardian.co.uk/business/story/0,,1333029,00.html Green gains £460m in Arcadia]," 22 October 2004, ''The Guardian'', accessed 23 March 2005.</ref> and the remainder went to HBoS, which holds the other 8% of the company.<ref>Flanagan, Martin, "[http://business.scotsman.com/philipgreen/Philip-Green-pockets-460m-dividend.2573965.jp Philip Green pockets £460m dividend from Arcadia]," 22 October 2004, ''Scotsman'', accessed 13 January 2011.</ref>
  
 
==HBoS and 'ethical investment'==
 
==HBoS and 'ethical investment'==
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In 2002 HBoS launched asset manager, [[Insight Investment]], which later that year started up an 'Investor Responsibility Service' which aimed to make it easier for 'institutional investors to demonstrate a commitment to addressing corporate responsibility issues, without compromising their financial objectives.'<ref>Flanagan, Martin, "[http://business.scotsman.com/philipgreen/Philip-Green-pockets-460m-dividend.2573965.jp Philip Green pockets £460m dividend from Arcadia]," 22 October 2004, ''Scotsman'', accessed 13 January 2011.</ref> Rather than limiting the companies in which it invest, Insight Investors favours the 'constructive engagement' approach, hosting conferences and organising meetings. Thus, rather than withdrawing investment from environmentally destructive energy and mining companies,it invites senior managers to seminar about, for example, biodiversity and management of fragile ecosystems.<ref>BSR, "[http://web.archive.org/web/20051208093826/http://www.csrwire.com/bsr/article.cgi/1422.html Insight Investment launches investor responsibility service]," 23 November 2002, Web Archive 08 December 2005, accessed 13 January 2011.</ref> The major companies invested in include: [[BAE Systems]], [[BP]], [[British Airways]], [[Cairn Energy]], [[Cadbury Schweppes]], [[Diageo]], [[Easyjet]], [[GlaxoSmithKline]], [[J Sainsbury]]'s, [[Marks and Spencer]]'s, [[Safeway]], [[Scottish and Southern Energy]], [[ScottishPower]], [[Shell]], [[Tesco]], [[Tullow Oil]] and [[Unilever]].<ref>Evo Energy, "[http://evoenergy.wordpress.com/2007/03/26/brown-goes-green-to-steal-tory-thunder/ Brown Goes Green to Steal Tory Thunder]," 26 March 2007, accessed 13 January 2011.</ref> The actual benefit of such investment in changing companies' ethical behaviour has yet to be demonstrated.
  
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In 2002 HBoS launched asset manager, [[Insight Investment]], which later that year started up an 'Investor Responsibility Service' which aimed to make it easier for 'institutional investors to demonstrate a commitment to addressing corporate responsibility issues, without compromising their financial objectives.'{{ref|35}} Rather than limiting the companies in which it invest, Insight Investors favours the 'constructive engagement' approach, hosting conferences and organising meetings. Thus, rather than withdrawing investment from environmentally destructive energy and mining companies,it invites senior managers to seminar about, for example, biodiversity and management of fragile ecosystems.{{ref|36}} The major companies invested in include: [[BAE Systems]], [[BP]], [[British Airways]], [[Cairn Energy]], [[Cadbury Schweppes]], [[Diageo]], [[Easyjet]], [[GlaxoSmithKline]], [[J Sainsbury]]'s, [[Marks and Spencer]]'s, [[Safeway]], [[Scottish and Southern Energy]], [[ScottishPower]], [[Shell]], [[Tesco]], [[Tullow Oil]] and [[Unilever]].{{ref|37}} The actual benefit of such investment in changing companies' ethical behaviour has yet to be demonstrated.
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Like many other high profile corporations HBOS has increasingly identified the potential of the 'green movement', as a a key source of growth for thier business. In a statement from HBOS, they announced,
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:"Green finance is clearly an area where lenders can play an important part. We plan to launch a green mortgage next year".<ref>HBOS plc, [http://www.wbcsd.ch/web/projects/cement/tf5/biodiversity_consultation_document.pdf Consultation document to accompany Insight’s presentation to the World Parks Congress], 13 September 2003, accessed 13 January 2011.</ref>
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Like many other high profile corporations HBoS has increasingly identified the potential of the 'green movement', as a a key source of growth for thier business. In a statement from HBOS, they announced,
 
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:"Green finance is clearly an area where lenders can play an important part. We plan to launch a green mortgage next year" {{ref|38}}.
 
  
 
==HBoS failing its poorer customers==
 
==HBoS failing its poorer customers==
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The Guardian reported that in November 2004, HBoS began charging up to £1.75 for cash withdrawals from its cash machines. This will hit lower income customers hardest especially those who have to use cash machines to withdraw benefits and pensions. With the closure of so many post offices in recent years, withdrawing benefits from cash machines is becoming more and more common.<ref>Insight Investment, [http://www.insightinvestment.com/responsibility/reporting/select_a_company_by_event.asp?1=A&2=A&yr=2003 Insight's engagement and voting 2003], accessed 16 March 2005.</ref>
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The Guardian reported that in November 2004, HBoS began charging up to £1.75 for cash withdrawals from its cash machines. This will hit lower income customers hardest especially those who have to use cash machines to withdraw benefits and pensions. With the closure of so many post offices in recent years, withdrawing benefits from cash machines is becoming more and more common.{{ref|38}}
 
  
 
==HBoS and accounting mismanagement==
 
==HBoS and accounting mismanagement==
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HBoS was fined £1.25 million in January 2004 for failing to protect against money laundering - they conducted an internal survey in 2002 and could not find records of necessary customer identification documents in 55% of cases.<ref>Inman, Philip, "[http://www.guardian.co.uk/guardian_jobs_and_money/story/0,,1360379,00.html Taxed at the cash machine]," 27 November 2004, ''The Guardian'', accessed 23 March 2005.</ref> This is an astonishing statistic, suggesting that although the bank should have scrutinised all their customers' accounts when money laundering legislation came into force, it did not do so.
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HBoS was fined £1.25 million in January 2004 for failing to protect against money laundering - they conducted an internal survey in 2002 and could not find records of necessary customer identification documents in 55% of cases.{{ref|39}} This is an astonishing statistic, suggesting that although the bank should have scrutinised all their customers&#39; accounts when money laundering legislation came into force, it did not do so.
 
  
 
==People==
 
==People==
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===Past Board Members===
 
===Past Board Members===
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*[[James Crosby]] (former Executive Director)
 
*[[James Crosby]] (former Executive Director)
 
*[[Bruce Pattullo]] (former Governor of the Bank of Scotland)
 
*[[Bruce Pattullo]] (former Governor of the Bank of Scotland)
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===Spinners and lobbyists===
 
===Spinners and lobbyists===
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HBOS relies less on external public affairs/lobbying organisations than many of its peers, however this may be due in part to the award winning {{ref|47}} in-house team of specialists they have brought in to lobby and campiagn on the corporations behalf.
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HBOS relies less on external public affairs/lobbying organisations than many of its peers, however this may be due in part to the award winning <ref>Tomlinson, Heather, "[http://www.guardian.co.uk/money/2004/jan/16/business.accounts HBOS flouted dirty money rules]," 16 January 2004, ''The Guardian'', accessed 13 January 2011.</ref> in-house team of specialists they have brought in to lobby and campiagn on the corporations behalf.
  
 
*[[Shane O'Riordain]], General Manager, Group Communications, Vizard's boss.
 
*[[Shane O'Riordain]], General Manager, Group Communications, Vizard's boss.
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===Large and Highprofile Shareholders===
 
===Large and Highprofile Shareholders===
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Former employee [[Stewart Stevenson]], currently [[Member of Scottish Parliament]] for Banff and Buchan has declared an interest in HBoS on the Register of Member's Interests - retaining HBoS ordinary stock of nominal value £10,250 (market value, approximately £410,000). He has has other declared shareholdings, in [[Scottish Power]] and [[Scottish & Southern Electricity]]<ref>CIPR, [http://www.cipr.co.uk/prideawards/scotland/2005/pastwinners.asp Chartered Institute of Public Relations 2005/06 PRide Awards Winners], accessed 12 April 2007.</ref>.
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Other substantial shareholdings are held by [[Legal & General Group]] Plc 4.02%, [[Barclays]] 3.97% and [[Capital Group Companies]] Inc 3.79%.<ref>Scottish Parliament, [http://www.scottish.parliament.uk/msp/index.htm Scottish Parliament Register of MSPs Interests], accessed 20 April 2007.</ref>
  
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Former employee [[Stewart Stevenson]], currently [[Member of Scottish Parliament]] for Banff and Buchan has declared an interest in HBoS on the Register of Member's Interests - retaining HBoS ordinary stock of nominal value £10,250 (market value, approximately £410,000). He has has other declared shareholdings, in [[Scottish Power]] and [[Scottish & Southern Electricity]]{{ref|1}}.
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==Controversies==
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In 2006 the Christmas savings hamper company [[Farepak]], owned by [[European Home retail]] collapsed because it could no longer meet its commitments to make deliveries to its customers. Halifax Bank of Scotland had provided an overdraft facility to European Home Retail, and the decision not to extend the overdraft eventually led to administrators being called in. The Bank had come into criticism after more than 150,000 customers, mainly on low incomes, lost an average of £400 each, although some lost closer to £2,000 because it had rejected a number of options that may have enabled Farepak to continue trading.<ref>The Stock Exchange Yearbook 2007.</ref>
  
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Other substantial shareholdings are held by [[Legal & General Group]] Plc 4.02%, [[Barclays]] 3.97% and [[Capital Group Companies]] Inc 3.79% {{ref|2}}.
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After receiving much negative media attention, HBOS responded to the criticism over its role in the Farepak collapse by giving £2m to the Family Fund,  a Yorkshire-based charity administering the Farepak Response Fund, set up to help victims of collapsed firm.<ref>BBC News, "[http://news.bbc.co.uk/2/hi/business/6142218.stm Farepak boss 'sorry' for collapse]," 13 November 2006, accessed 13 January 2011.</ref>
  
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== Controversies ==
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Though in December 2006 [[HBOS]] launched an attack on customers of the failed Christmas club, claiming that a lack of gratitude may have deterred donations to a charity fund.<ref>Levene, Tony, "[http://www.guardian.co.uk/business/2006/nov/09/money HBOS gives to Farepak charity after criticism], 09 November 2006, accessed 13 January 2011.</ref>
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In 2006 the Christmas savings hamper company [[Farepak]], owned by [[European Home retail]] collapsed because it could no longer meet its commitments to make deliveries to its customers. Halifax Bank of Scotland had provided an overdraft facility to European Home Retail, and the decision not to extend the overdraft eventually led to administrators being called in. The Bank had come into criticism after more than 150,000 customers, mainly on low incomes, lost an average of £400 each, although some lost closer to £2,000 because it had rejected a number of options that may have enabled Farepak to continue trading{{ref|40}}.
 
  
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After receiving much negative media attention, HBOS responded to the criticism over its role in the Farepak collapse by giving £2m to the Family Fund,  a Yorkshire-based charity administering the Farepak Response Fund, set up to help victims of collapsed firm {{ref|41}}.
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In a recent, but equally controversial move, HBoS have announced their intention to set up thier own Christmas Savings Account aimed at low income families. A deposit of £5 is required to open the new account with a minimum of £5 a month thereafter, to a maximum of £100 a month. They will be able to take their savings in cash or vouchers.<ref>Womack, Stephen, "Farepak bank: be far more grateful," ''Financial Mail on Sunday'', 17 December 2006.</ref>
  
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Though in December 2006 [[HBOS]] launched an attack on customers of the failed Christmas club, claiming that a lack of gratitude may have deterred donations to a charity fund {{ref|42}}.
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==Funding==
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HBOS is a member and funder of a number of external organisations and bodies. The charitable work of HBOS is carried out predominately through the [[HBOS Foundation]].<ref>Tinning, William, "[http://www.heraldscotland.com/hbos-offers-christmas-savings-account-for-low-income-families-1.855097 HBOS offers Christmas savings account for low-income families],"28 March 2007, ''The Herald'', accessed 13 January 2011.</ref>
  
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In a recent, but equally controversial move, HBoS have announced their intention to set up thier own Christmas Savings Account aimed at low income families. A deposit of £5 is required to open the new account with a minimum of £5 a month thereafter, to a maximum of £100 a month. They will be able to take their savings in cash or vouchers {{ref|43}}.
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==Affiliations==
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HBOS is affiliated and involved with a number of other organisations including [[Forum for the Future]], the [[Hansard Society]] and [[Scottish Financial Enterprise]] (sometimes referred to as the [[Scottish Financial Network]]).  HBOS are members of the [[European Sponsorship Association]].
  
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== Funding ==
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{{Template: Revolving Door badge}}
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HBOS is a member and funder of a number of external organisations and bodies. The charitable work of HBOS is carried out predominately through the [[HBOS Foundation]]{{ref|42}}.
 
  
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== Affiliations ==
 
  
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HBOS is affiliated and involved with a number of other organisations including [[Forum for the Future]], the [[Hansard Society]] and [[Scottish Financial Enterprise]] (sometimes referred to as the [[Scottish Financial Network]]). HBOS are members of the [[European Sponsorship Association]].
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==Resources==
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*BBC News, "[http://news.bbc.co.uk/2/hi/business/6142218.stm Farepak boss 'sorry' for collapse]," 13 November 2006, accessed 13 January 2011
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*BBC News Sport, "[http://news.bbc.co.uk/sport1/hi/football/scot_prem/4835062.stm, Bank to end its SPL sponsorship]," 22 March 2006, accessed 13 January 2011.
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*BSR, "[http://web.archive.org/web/20051208093826/http://www.csrwire.com/bsr/article.cgi/1422.html Insight Investment launches investor responsibility service]," 23 November 2002, Web Archive 08 December 2005, accessed 13 January 2011.
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*CIPR, [http://www.cipr.co.uk/prideawards/scotland/2005/pastwinners.asp Chartered Institute of Public Relations 2005/06 PRide Awards Winners], accessed 12 April 2007.
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*Dey, Iain, "[http://business.scotsman.com/halifaxbankofscotland/HBOS-drives-ahead-with-Australian.2572773.jp HBOS drives ahead with Australian PFI]," 17 October 2004, ''Scotsman'', accessed 13 January 2011.
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*Evo Energy, "[http://evoenergy.wordpress.com/2007/03/26/brown-goes-green-to-steal-tory-thunder/ Brown Goes Green to Steal Tory Thunder]," 26 March 2007, accessed 13 January 2011.
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*Fame Company Information Database, (not available online) accessed 19 April 2007.
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*Finch, Julia, "[http://www.guardian.co.uk/business/story/0,,1333029,00.html Green gains £460m in Arcadia]," 22 October 2004, ''The Guardian'', accessed 23 March 2005.
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*Flanagan, Martin, "[http://business.scotsman.com/philipgreen/Philip-Green-pockets-460m-dividend.2573965.jp Philip Green pockets £460m dividend from Arcadia]," 22 October 2004, ''Scotsman'', accessed 13 January 2011.
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*Fraser, Ian, "[http://findarticles.com/p/articles/mi_qn4156/is_20041128/ai_n12592404/ HBOS cultivates Down Under for growth; Having scrapped plans to]," 28 November 2004, ''Sunday Herald'', accessed 13 January 2011.
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*HBOS, [http://www.hbosplc.com/abouthbos/home.asp About HBoS], accessed 01 February 2007.
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*HBOS, "[http://web.archive.org/web/20030727180911/http://www.hbosplc.com/media/pressreleases/articles/bos/2002-07-05-02.asp Bank of Scotland Exports UK Lead In PFI/PPP to Europe with Participation in Ground-Breaking €915 Million French Motorway Project]," 05 July 2002, Web Archive 27 July 2003, accessed 13 January 2011.
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*HBOS plc, [http://www.wbcsd.ch/web/projects/cement/tf5/biodiversity_consultation_document.pdf Consultation document to accompany Insight’s presentation to the World Parks Congress], 13 September 2003, accessed 13 January 2011.
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*Inman, Philip, "[http://www.guardian.co.uk/guardian_jobs_and_money/story/0,,1360379,00.html Taxed at the cash machine]," 27 November 2004, ''The Guardian'', accessed 23 March 2005.
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*Insight Investment, [http://www.insightinvestment.com/responsibility/reporting/select_a_company_by_event.asp?1=A&2=A&yr=2003 Insight's engagement and voting 2003], accessed 16 March 2005.
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*Kievturk, [http://web.archive.org/web/20050214073155/http://kievturk.com/?m=news&page=2&newsid=7 Caspian & Black Sea Oil and Gas Conference 2004 Key Facts], Web Archive 14 February 2005, accessed 13 January 2011.
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*Levene, Tony, "[http://www.guardian.co.uk/business/2006/nov/09/money HBOS gives to Farepak charity after criticism], 09 November 2006, accessed 13 January 2011.
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*Living Book Project, [http://www.livingbook.co.uk/funding.htm Living Book Website], accessed 21 February 2007.
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*No Sweat, "[http://www.nosweat.org.uk/article.php?sid=468 A Partial Victory for Bed and Bath workers]," accessed 16 March 2005.
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*''Scottish Business Insider''.
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*Scottish Enterprise, [http://www.scottish-enterprise.com/sedotcom_home/services_to_business_international/lis/about-scotland/about_scotland-keyfacts.htm About Scotland Keyfacts], accessed 31 January 2007.
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*Scottish Parliament, [http://www.scottish.parliament.uk/msp/index.htm Scottish Parliament Register of MSPs Interests], accessed 20 April 2007.
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*The Stock Exchange Yearbook 2007.
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*Tinning, William, "[http://www.heraldscotland.com/hbos-offers-christmas-savings-account-for-low-income-families-1.855097 HBOS offers Christmas savings account for low-income families],"28 March 2007, ''The Herald'', accessed 13 January 2011.
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*Tomlinson, Heather, "[http://www.guardian.co.uk/money/2004/jan/16/business.accounts HBOS flouted dirty money rules]," 16 January 2004, ''The Guardian'', accessed 13 January 2011.
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*Womack, Stephen, "Farepak bank: be far more grateful," ''Financial Mail on Sunday'', 17 December 2006.
  
 
==Notes==
 
==Notes==
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#{{note|photo}} [http://www.hbosplc.com/abouthbos/history/corporate_headquarters.asp HBoS Headquarters], last viewed 21/02/07
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<references/>
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#{{note|1}} [http://www.hbosplc.com/abouthbos/home.asp About HBoS ], last viewed 01.02.07
 
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#{{note|2}} [http://www.scottish-enterprise.com/sedotcom_home/services_to_business_international/lis/about-scotland/about_scotland-keyfacts.htm Scottish Enterprise About Scotland Keyfacts], last viewed 31.01.07
 
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# {{note|3}} Fame Company Information Database. Accessed 19/04/07. Not available online
 
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# {{note|4}} BBC News Sport (2006)[http://news.bbc.co.uk/sport1/hi/football/scot_prem/4835062.stm, Bank to end its SPL sponsorship]. Last accessed 20/04/07
 
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# {{note|5}}'HBoS cultivates down under for growth' ''Sunday Herald'' 28 November 2004
 
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# {{note|6}} Fame Company Information Database. Accessed 19/04/07. Not available online
 
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# {{note|7}}'Bank of Scotland Exports UK lead in PFI/PPP to Europe,' 05.07.02
 
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# {{note|8}} Iain Dey, [http://business.scotsman.com/topics.cfm?tid=497&id=120657200 HBOS drives ahead with Australian PFI]. In The Scotsman 17/10/04
 
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# {{note|9}}Scottish Business Insider
 
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# {{note|10}}[http://www.kievturk.com/?m=news&page=2&newsid=7 Caspian & Black Sea Oil and Gas Conference 2004 Key Facts]. Last viewed 16.3.05
 
−
# {{note|11}}Julia Finch,[http://www.guardian.co.uk/business/story/0,,1333029,00.html Green gains £460m in Arcadia]. In The Guardian 22/10/04. Last viewed 23.03.05
 
−
# {{note|12}} [http://www.nosweat.org.uk/article.php?sid=468 A Partial Victory for Bed and Bath workers]. Last viewed 16.3.05
 
−
# {{note|13}}Julia Finch,[http://www.guardian.co.uk/business/story/0,,1333029,00.html Green gains £460m in Arcadia]. In The Guardian 22/10/04. Last viewed 23.03.05
 
−
# {{note|14}}[http://business.scotsman.com/topics.cfm?tid=368 Philip Green pockets £460m dividend from Arcadia]. In The Scotsman 22/10/04
 
−
# {{note|15}}[http://business.scotsman.com/topics.cfm?tid=368 Philip Green pockets £460m dividend from Arcadia]. In The Scotsman 22/10/04
 
−
# {{note|16}} [http://www.csrwire.com/bsr/article.cgi/1422.html Insight Investment launches investor responsibility service] 23/11/02. Last viewed 23.03.05
 
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# {{note|17}} Evo Energy (2007)[http://evoenergy.wordpress.com/2007/03/26/brown-goes-green-to-steal-tory-thunder/Brown Goes Green to Steal Tory Thunder]. Last viewed 28/03/07
 
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# {{note|18}}Insight Investment,[http://www.wbcsd.ch/web/projects/cement/tf5/biodiversity_consultation_document.pdf Biodiversity: towards best practice for extractive and utility companies] 13.11.03. Last viewed 23.03.05
 
−
# {{note|19}} [http://www.insightinvestment.com/responsibility/reporting/select_a_company_by_event.asp?1=A&2=A&yr=2003 Insight's engagement and voting 2003]. Last viewed 16.3.05
 
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# {{note|20}} Philip Inman[http://www.guardian.co.uk/guardian_jobs_and_money/story/0,,1360379,00.html Taxed at the cash machine]. In The Guardian 27.11.04. Last viewed 23.03.05
 
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# {{note|21}}Heather Tomlinson, [http://money.guardian.co.uk/saving/banks/story/0,12410,1124473,00.html HBOS flouted dirty money rules]. In The Guardian 16/01/04
 
−
# {{note|22}} CIPR (2006) [http://www.cipr.co.uk/prideawards/scotland/2005/pastwinners.asp Chartered Institute of Public Relations 2005/06 PRide Awards Winners]. Last accessed 12/04/07
 
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# {{note|23}} [http://www.scottish.parliament.uk/msp/index.htm Scottish Parliament Register of MSPs Interests]. Last viewed 20/04/07
 
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# {{note|24}} The Stock Exchange Yearbook 2007
 
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# {{note|25}}BBC News, [http://news.bbc.co.uk/1/hi/business/6142218.stm Farepak boss 'sorry' for collapse], last accesed 21/02/07
 
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# {{note|41}} Levene, T. (2006) [http://business.guardian.co.uk/story/0,,1942776,00.html HBOS gives to Farepak charity after criticism], last accessed 21/02/07
 
−
# {{note|42}} Womack, S. (2006) Farepak bank: be far more grateful. Financial Mail on Sunday; London. 17/12/06
 
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# {{note|44}} Tinning, W. (2007) [http://www.theherald.co.uk/news/other/display.var.1289859.0.0.php HBOS offers Christmas savings account for low-income families], in The Herald 28th March 2007, last accessed 28/03/07
 
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# {{note|43}} [http://www.livingbook.co.uk/funding.htm Living Book Website], last accessed 21/02/07
 
 
[[Category:Banking and Finance Industry]]
 
[[Category:Banking and Finance Industry]]
 +
[[Category: Financial Revolving Door]]

Revision as of 14:40, 13 January 2011

HBOS Head Office

Formed from the merger of the Halifax Building Society and Bank of Scotland in 2001, and head quartered in Edinburgh, with 22 million customers and assets of over £540 billion,[1] HBOS ranks third in the list of Scotland's top 500 companies and is the seventh largest bank in Europe.[2] The company employs around 72,000 staff globally and reported a net income in 2006 of £3939 million.[3]


The HBoS is one of the largest commercial sponsors of sport and the arts in Scotland, to the tune of £19.5 million in 2003, and is best known for its sponsorship of the Scottish Premier League. However this is due to expire at the end of the current 9-year deal in 2007.[4]


There are four main subsidiaries at HBOS: Halifax Plc, The Governor & Company of the Bank of Scotland, HBOS Australia and HBOS Insurance & Investment Group. Australia features highly in the companies expansion plans [1]. HBOS lists 594 active companies that they retain a business interests in,[5] some of the more well known subsidiaries include: Bank of Western Australia Ltd, BankWest, Capital Finance and St Andrews Insurance; and UK companies Clerical Medical, Birmingham Midshires, Capital Bank, Godfrey Davis, Lex Vehicle Leasing, Hill Hire Plc, Sainsbury's Bank, BM Solutions; The Mortgage Business; Rightmove; First Alternative; Esure; Employee Share Services; Mentor Professional Services; St Andrews Group, St James's Place Bank, St James's Place Group (formerly known as St James's Place Capital Plc), and of course Banco Halifax Hispania, Bank of Scotland (Ireland) and Bank of Scotland (The Netherlands).


HBOS investments

Unlike the Royal Bank of Scotland, HBoS is less involved in overseas project finance. Though the expansion of HBOS Australia appears to be a definate corporate strategy of late. Since 2002 the Bank of Scotland consolidated its position as a leader in PPP/PFI type finance, bringing the first such deal to France as a partner in the construction of a new motorway.[6] In 2004 it won a major share in an Australian PFI initiative, another road-building project.[7] In 2004 the Bank of Scotland part-funded a £35m PPP/PFI deal with the City of Edinburgh Council for the Edinburgh Schools Partnership for the design, construction, financing and operation of 4 schools.[8]


In Glasgow the 3ED consortium, involving the Miller Group construction company, the Halifax bank (now HBoS) and Hewlett Packard computers, will organise construction and retain operational control of the school buildings for the next 29 years. The city council will rent the buildings from 3ED for an annual fee of £40.5 million, an arrangement that is guaranteed to continue for the next 30 years, allowing 3ED to re-coup £1.2bn. This move had been prepared for by the closure of 9 secondary schools in Glasgow, with a population of 30,000 pupils.


HBOS finances Wood McKenzie, a Scottish oil and gas consultancy firm also involved in Caspian oil and gas.[9]


In 2002 HBoS financed Philip Green's take-over of Arcadia, the retail group which owns high street brands such as Topshop, Miss Selfridge, Dorothy Perkins and Burtons.[10] No Sweat UK has reported union repression and low wages in this group. Factories in London's Whitechapel producing goods for Arcadia were found to be paying substantially under the minimum wage, and other UK suppliers claimed that the company paid so little that they could not provide better wages or working conditions. In Bombay in 2002 there were reports of intimidation of union members, including harassment, physical assault and reduced work.[11] In 2004, Philip Green wrote himself a cheque for 3460 million as a result of profits from Arcadia,[12] and the remainder went to HBoS, which holds the other 8% of the company.[13]

HBoS and 'ethical investment'

In 2002 HBoS launched asset manager, Insight Investment, which later that year started up an 'Investor Responsibility Service' which aimed to make it easier for 'institutional investors to demonstrate a commitment to addressing corporate responsibility issues, without compromising their financial objectives.'[14] Rather than limiting the companies in which it invest, Insight Investors favours the 'constructive engagement' approach, hosting conferences and organising meetings. Thus, rather than withdrawing investment from environmentally destructive energy and mining companies,it invites senior managers to seminar about, for example, biodiversity and management of fragile ecosystems.[15] The major companies invested in include: BAE Systems, BP, British Airways, Cairn Energy, Cadbury Schweppes, Diageo, Easyjet, GlaxoSmithKline, J Sainsbury's, Marks and Spencer's, Safeway, Scottish and Southern Energy, ScottishPower, Shell, Tesco, Tullow Oil and Unilever.[16] The actual benefit of such investment in changing companies' ethical behaviour has yet to be demonstrated.

Like many other high profile corporations HBOS has increasingly identified the potential of the 'green movement', as a a key source of growth for thier business. In a statement from HBOS, they announced,

"Green finance is clearly an area where lenders can play an important part. We plan to launch a green mortgage next year".[17]

HBoS failing its poorer customers

The Guardian reported that in November 2004, HBoS began charging up to £1.75 for cash withdrawals from its cash machines. This will hit lower income customers hardest especially those who have to use cash machines to withdraw benefits and pensions. With the closure of so many post offices in recent years, withdrawing benefits from cash machines is becoming more and more common.[18]

HBoS and accounting mismanagement

HBoS was fined £1.25 million in January 2004 for failing to protect against money laundering - they conducted an internal survey in 2002 and could not find records of necessary customer identification documents in 55% of cases.[19] This is an astonishing statistic, suggesting that although the bank should have scrutinised all their customers' accounts when money laundering legislation came into force, it did not do so.

People

The Chairman of the Board is Dennis Stevenson. In addition there are five executive directors and eight non-executive directors, including Sir Ronald Garrick who is the deputy chairman.

Current Executive Directors

Current Non-Executive Directors

Past Board Members

Executive Committee

The HBOS Executive Committee is the senior executive team of the HBOS Group.

The six executive directors along with Harry Baines and Dan Watkins make up the Executive Committee.

Spinners and lobbyists

HBOS relies less on external public affairs/lobbying organisations than many of its peers, however this may be due in part to the award winning [20] in-house team of specialists they have brought in to lobby and campiagn on the corporations behalf.

Large and Highprofile Shareholders

Former employee Stewart Stevenson, currently Member of Scottish Parliament for Banff and Buchan has declared an interest in HBoS on the Register of Member's Interests - retaining HBoS ordinary stock of nominal value £10,250 (market value, approximately £410,000). He has has other declared shareholdings, in Scottish Power and Scottish & Southern Electricity[21].

Other substantial shareholdings are held by Legal & General Group Plc 4.02%, Barclays 3.97% and Capital Group Companies Inc 3.79%.[22]

Controversies

In 2006 the Christmas savings hamper company Farepak, owned by European Home retail collapsed because it could no longer meet its commitments to make deliveries to its customers. Halifax Bank of Scotland had provided an overdraft facility to European Home Retail, and the decision not to extend the overdraft eventually led to administrators being called in. The Bank had come into criticism after more than 150,000 customers, mainly on low incomes, lost an average of £400 each, although some lost closer to £2,000 because it had rejected a number of options that may have enabled Farepak to continue trading.[23]

After receiving much negative media attention, HBOS responded to the criticism over its role in the Farepak collapse by giving £2m to the Family Fund, a Yorkshire-based charity administering the Farepak Response Fund, set up to help victims of collapsed firm.[24]

Though in December 2006 HBOS launched an attack on customers of the failed Christmas club, claiming that a lack of gratitude may have deterred donations to a charity fund.[25]

In a recent, but equally controversial move, HBoS have announced their intention to set up thier own Christmas Savings Account aimed at low income families. A deposit of £5 is required to open the new account with a minimum of £5 a month thereafter, to a maximum of £100 a month. They will be able to take their savings in cash or vouchers.[26]

Funding

HBOS is a member and funder of a number of external organisations and bodies. The charitable work of HBOS is carried out predominately through the HBOS Foundation.[27]

Affiliations

HBOS is affiliated and involved with a number of other organisations including Forum for the Future, the Hansard Society and Scottish Financial Enterprise (sometimes referred to as the Scottish Financial Network). HBOS are members of the European Sponsorship Association.

Revolving Door.jpg This article is part of the Revolving Door project of Spinwatch.




Resources

Notes

  1. ↑ HBOS, About HBoS, accessed 01 February 2007.
  2. ↑ Scottish Enterprise, About Scotland Keyfacts, accessed 31 January 2007.
  3. ↑ Fame Company Information Database, (not available online) accessed 19 April 2007.
  4. ↑ BBC News Sport, "Bank to end its SPL sponsorship," 22 March 2006, accessed 13 January 2011.
  5. ↑ Fraser, Ian, "HBOS cultivates Down Under for growth; Having scrapped plans to," 28 November 2004, Sunday Herald, accessed 13 January 2011.
  6. ↑ HBOS, "Bank of Scotland Exports UK Lead In PFI/PPP to Europe with Participation in Ground-Breaking €915 Million French Motorway Project," 05 July 2002, Web Archive 27 July 2003, accessed 13 January 2011.
  7. ↑ Dey, Iain, "HBOS drives ahead with Australian PFI," 17 October 2004, Scotsman, accessed 13 January 2011.
  8. ↑ Scottish Business Insider.
  9. ↑ Kievturk, Caspian & Black Sea Oil and Gas Conference 2004 Key Facts, Web Archive 14 February 2005, accessed 13 January 2011.
  10. ↑ Finch, Julia, "Green gains £460m in Arcadia," 22 October 2004, The Guardian, accessed 23 March 2005.
  11. ↑ No Sweat, "A Partial Victory for Bed and Bath workers," accessed 16 March 2005.
  12. ↑ Finch, Julia, "Green gains £460m in Arcadia," 22 October 2004, The Guardian, accessed 23 March 2005.
  13. ↑ Flanagan, Martin, "Philip Green pockets £460m dividend from Arcadia," 22 October 2004, Scotsman, accessed 13 January 2011.
  14. ↑ Flanagan, Martin, "Philip Green pockets £460m dividend from Arcadia," 22 October 2004, Scotsman, accessed 13 January 2011.
  15. ↑ BSR, "Insight Investment launches investor responsibility service," 23 November 2002, Web Archive 08 December 2005, accessed 13 January 2011.
  16. ↑ Evo Energy, "Brown Goes Green to Steal Tory Thunder," 26 March 2007, accessed 13 January 2011.
  17. ↑ HBOS plc, Consultation document to accompany Insight’s presentation to the World Parks Congress, 13 September 2003, accessed 13 January 2011.
  18. ↑ Insight Investment, Insight's engagement and voting 2003, accessed 16 March 2005.
  19. ↑ Inman, Philip, "Taxed at the cash machine," 27 November 2004, The Guardian, accessed 23 March 2005.
  20. ↑ Tomlinson, Heather, "HBOS flouted dirty money rules," 16 January 2004, The Guardian, accessed 13 January 2011.
  21. ↑ CIPR, Chartered Institute of Public Relations 2005/06 PRide Awards Winners, accessed 12 April 2007.
  22. ↑ Scottish Parliament, Scottish Parliament Register of MSPs Interests, accessed 20 April 2007.
  23. ↑ The Stock Exchange Yearbook 2007.
  24. ↑ BBC News, "Farepak boss 'sorry' for collapse," 13 November 2006, accessed 13 January 2011.
  25. ↑ Levene, Tony, "HBOS gives to Farepak charity after criticism, 09 November 2006, accessed 13 January 2011.
  26. ↑ Womack, Stephen, "Farepak bank: be far more grateful," Financial Mail on Sunday, 17 December 2006.
  27. ↑ Tinning, William, "HBOS offers Christmas savings account for low-income families,"28 March 2007, The Herald, accessed 13 January 2011.
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