UK inquiry to question ex-HBOS chief executives

Two former chief executives of HBOS will appear on Monday before British lawmakers conducting an inquiry into the bank’s near collapse in 2008, as part of a wider review of banking standards.

HBOS had to be rescued in 2008 through a government-engineered takeover by Lloyds Banking Group which, weeks later, needed to ask for a £20 billion government bailout to stay afloat.

Andrew Tyrie, the conservative MP who heads the Parliamentary Commission on Banking Standards, said yesterday that the commission wanted to examine why HBOS failed and what lessons can be learnt to prevent future banking failures.

The commission will take evidence on Monday from James Crosby, HBOS chief executive between 2001 and 2005, and Andrew Hornby, who was CEO from 2006 until 2008. On Tuesday, it will hear from Lord Stevenson, HBOS chairman between 2001 and 2009.

“Two of these men were on the bridge when HBOS failed, when public money was needed to rescue it and when trust in our banking system – both within the industry and among the public – collapsed almost completely,” Tyrie said.

HBOS’s downfall was blamed upon the overly aggressive growth of its corporate division.