Other banks follow in the footsteps of RBS

Apr 30 2008 by Tim Jenkins, Western Mail

PREDICTABLY after RBS went to the market last week for a shareholder handout, the more shy bankers have decided to throw in their lot. This week saw HBOS announce plans for a rights issue.

The bank simultaneously asked for £4bn while writing off almost £3bn in US-linked sub-prime assets.

The bank stated the obvious by saying it was preparing itself for “a more challenging environment ahead”.

HBOS is significant in the UK as it is the most widely-held share, having been the product of the demutualisation of the Halifax in 1997 and the subsequent merger with Bank of Scotland in 2001.

Well, enough of history and, as Nessa from Gavin and Stacey would say, “What’s occurring?”

Occurring is a 45% discount on Monday’s share price, remarkably almost the exact discount RBS placed on its issue the week before. But don’t rush, you have until the beginning of August to make up your mind.

Of course every cloud etc ... and for BP and Royal Dutch Shell the silver lining came in the wake of escalating oil prices. The net result saw both companies reporting booming first-quarter profits.

This should translate across the sector and today Dana Petroleum releases its full results. The one-month graph makes interesting reading and shows a swift and convincing recovery from just over 12 quid to £16.55.

The recent good fortune for all oil stocks has come on the back of a barrel hitting a mind-blowing $120. But that’s just the tip of the iceberg according to some at Opec, who predict the continuing slide of the US dollar could well see oil top $200 a barrel.

While MPs may be lucky enough to shop using the John Lewis catalogue, for us mere mortals, the Argos book will suffice. And so Home Retail, the owner of Argos and Homebase, will open their books today and report.

As you might expect, it hasn’t been a grand year in the high street. It’s also been a tricky year for home improvement firms.

The company enjoys sales of £5.8bn and is a leading retailer in almost all the products it sells. Trading down to a day low of £2.40 yesterday, the price is well off a year’s high of £4.97.

If you’re thinking of investing, why not pop into a local store on Saturday?

You might just get a feel for what’s really happening.