Shareholders give go-ahead to HBoS rights issue

  • Story by: Gemma Westacott
  • Magazine: FTAdviser
  • Published Friday , June 27, 2008

Shareholders in Halifax Bank of Scotland (HBoS) have voted 98 per cent in favour of the lender's proposal for a £4bn cash call.

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HBoS had asked shareholders to support the rights issue in which new shares will be sold to investors at a discounted price of 275p to help bolster its balance sheet.

The cash call comes after HBoS, like many other UK banks, has suffered significant investment write-downs caused by the credit crunch.

Shareholders met in Edinburgh last night (26 June) to vote on the scheme. They heard from HBoS chairman Dennis Stevenson who claimed that the move was the "fundamentally the right thing" for the business.

HBOS shares are currently worth around a quarter of their value a year ago. They have taken a significant hit in recent weeks, undermining the cash call by falling behind the rights issue asking price.

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