Shareholders in British bank have overwhelmingly approved the bank's takeover by Lloyds TSB and an £11.5 billion injection of cash from the British government. This is according to votes cast ahead of the shareholders' meeting in Birmingham.
The vote came after HBOS, which owns Halifax and Bank of Scotland Ireland, said that bad debts and other charges jumped to £8 billion this year as corporate and home loans soured.
Britain's biggest home lender said the losses would hit its capital ratios, but it declined to say by how much, and said the outlook was grim.
In a statement ahead of its shareholder meeting, it said a deterioration in credit quality had accelerated and estimated that asset values had fallen sharply since November.
HBOS said charges for bad debts and losses on assets totalled £8 billion for the year to the end of November, up from £4.8 billion at the end of September.
Bad debts on corporate loans almost doubled to £3.3 billion pounds from £1.7 billion. Losses on the unit's investment portfolio also rose, to £800m from £100m two months earlier.
Sharp declines in house prices and pressure on margins from interest rate cuts helped lift impairments on mortgages to £700m from £400 million, the bank said.
'In light of the worsening economic climate, trends in retail impairment charges are likely to come under further pressure,' it said. It added that pressure on net interest margins is building due to the recent cuts in UK base rates, which have been slashed to 2%.
