19 September 2008
The proposed merger between Lloyds TSB and HBOS could be bad news for consumers, according to the Senior Technical Manager at John Charcol. The Financial Services Authority said this week that the move was a "welcome" one that would enhance market stability and restore consumer confidence in the banking industry. But Ray Boulger opposed this view, insisting: "Any reduction in competition is nearly always bad news for consumers." If the merger is given the go ahead, the combined group would become a dominant player in the market for current accounts. Lloyds TSB is the UK's largest provider of current accounts with a 22% share of the market, while HBOS has a 13% share. According to Reuters, Lloyds TSB has 1,900 branches across the UK and HBOS has 1,100. Lloyds TSB recent launched a new fee-free current account offering tiered interest rates to customers who pay in at least £1,000 per month and remain in credit.
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