Another bank bailout of £40bn
Updated on 03 November 2009
Twelve months after a massive multi-billion pound bailout, Britain's banks are getting almost £40bn in public money and in exchange for curbs on bonuses.
As moves to break up the part-nationalised Royal Bank of Scotland and Lloyds were confirmed, the Chancellor Alistair Darling told MPs it would mean stronger, safer banks and a better deal for the taxpayer.
But the Conservatives called it a 'world record for bailouts', costing the equivalent of £2,000 per family.
In a statement to MPs, Mr Darling said the changes would potentially create three new banks on the high street over five years.
Fears of a "global depression" had receded and "market confidence" had started to return.
He said: "As a result we are now able to achieve our objectives on financial stability and banking reform at a lower overall cost to the taxpayer."
Setting out the terms of the deal, Mr Darling said Lloyds would raise £21bn in the open market and begin its "transition" from state support to private finance, while agreeing to pay the Treasury a fee of £2.5bn.
"Today's decisions make Lloyds a stronger bank and provide better value for the taxpayer."
Paul Moore, the former HBOS executive who was fired by Sir James Crosby, allegedly for warning about the bank's excessive risk-taking, told Channel 4 News: "There hasn't really been a proper inquiry into who did what and who didn't do what in the boardrooms of those banks.
"We had a Treasury Select Committee review which is at one level of forensic detail and really many of the managers that were there before are still there in charge.
"Not a single politician, not a single regulator and not a single bank director has been in any way held to account and because we haven't actually enquired as to precisely who did what we don't really know how to reconstruct the system.
"It has to be reconstructed completely in order to balance the powers in the boardrooms and to make sure the control functions have an equal voice in those boardrooms.
"The Walker review so far by the FSA has not made any radical propsals at all, its report is coming out shortly."
