HBOS is second UK bank to make rights issue

HBOS follows in footsteps of RBS with multi-billion pound rights issue last week, with further troubled banks expected to follow suit, according to managers

HBOS is the second UK bank in a week to make a rights issue in the hope of lessening the impact of sub-prime writedowns. Late last month, RBS announced it was seeking £12bn from shareholders, the biggest rights issue in UK business history, and Barclays is rumoured to be next in line. The figures involved give an indication just how far some questionable lending practices, and last year's credit crunch, have put these banks in a corner. RBS reported losses of £4.3bn, while HBOS is trying to shore up almost the same amount to strengthen its capital base. Some investors have seen this...