HBOS is not the only bank facing the threat of a takeover

The bank's rights issue has not eased its troubles, writes Katherine Griffiths The City watchdog surprised the market on Friday, June 13, by announcing a dramatic clampdown on short selling during rights issues. For some in the City, this rapidly became known as the Dennis Stevenson rule, after the politically well-connected chairman of HBOS, Britain's biggest mortgage lender whose share price was in the middle of a particularly nasty stock market storm. HBOS - whose crown as the UK’s market leader is expected to be stolen by Santander-owned Abbey this week - had announced a £4bn rights issue in April, but was being battered by speculation ranging from fears of a black hole in its corporate banking business to jitters about further write-offs from investments in US sub-prime mortgages. Overriding everything was speculation... [read full story]