HBOS SAID yesterday that senior management, including executive director Peter Cummings, bought more shares in Britain's biggest mortgage lender, days after it dismissed rumours its balance sheet was in trouble.
Executive directors, non-executive directors and senior managers at HBOS bought some 1.4 million shares last Thursday at £4.46 (€5.70) per share using their bonus entitlements, the company said in a statement.
Chief executive Andy Hornby bought 92,812 shares, taking his total to 721,598 shares, and finance director Mike Ellis bought 10,287 shares. The filings indicate a show of belief in the company's business and come days after shares in the owner of the Halifax brand took a pummelling amid talk that higher interbank lending rates would hurt its ability to access funding.
Last Wednesday the rumours drove shares in the Edinburgh-based bank down to their lowest level since they began trading in September 2001. The bank's stock lost as much as 18 per cent of its value in early trading that day.
The rumours led Britain's financial authorities to make a rare public move to calm jittery markets, saying they were not aware of problems at any UK bank and would investigate share price moves sparked by rumours.
HBOS, whose shares bore the brunt of the impact of the rumours, dismissed the speculation, saying it had an "exceptionally strong balance sheet" and continued to access wholesale funding.
A similar investigation is under way by the Irish Financial Services Regulatory Authority into "false and misleading rumours" about the fiscal health of Anglo Irish Bank and Irish Life & Permanent, following sharp drops in their share prices in trading early last week.
In Ireland HBOS's business includes the Halifax branch network and the business lender Bank of Scotland (Ireland). - ( Reuters )
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