THE sport has not waned. Despite a solid 18 months of banking crisis – particularly in Scotland – some 600 Lloyds and HBOS shareholders turned up to the SECC yesterday to "bait a banker".
The entertainment, if it could be called that, lasted a good three hours. It is just too bad that most people missed the ponies.
Two black horses, one big and one small, highlighting the difference in the value of Lloyds before and after the take
over, stood patiently outside the meeting to publicise the efforts of a group of shareholders who are intending to sue the board for misrepresenting the deal to shareholders.
All 17 members of the Lloyds board were there, but most faced the audience in the gloomily lit cavern of the SECC mutely and wanly as chairman Sir Victor Blank did most of the talking.
However, some shareholders gave him a run for his money. At AGMs there are always a few who, rather than ask questions, prefer to read out prepared diatribes – some of them at length.
As the procession of shareholders asked what seemed to be the same question again and again – how could you do this? How could you let this happen to us? – patience with the sport eventually waned and those spouting overly long expositions were shouted down. But only after a few hours had passed…
Sir Victor, who mostly maintained his good humour throughout the meeting despite being forced to resign, seemed to run out of new ways to defend both himself in the bank.
He had his script. He delivered several variations on the themes: that it was the right deal for shareholders – not now, but in the medium term. Yes, he was going, but not until a successor could be found. Yes, he admitted, he and the board were sorry they had caused their shareholders so much pain.
Although Mr Blank is a multi-millionaire, with a manor house in Oxford where he hosts legendary social and charity events, no, he is apparently not immune to the plight of the small shareholders.
But pathos for the board was limited. One retired bank employee admitted to the audience he was on the verge of losing his house as the fall-off in dividends had cut his income by two-thirds. He did not seem mollified by Blank's assurances.
The trick to successful jousts at the board, as shown at the SECC yesterday, was to keep it short, perhaps add a joke or two – but don't let the bankers off the hook.
One of the first to the microphone stations was shareholder James Smith.
"Why weren't the toxic assets clearly identified to shareholders? It is like going into the room and not noticing an elephant," he said.
"It is preposterous this happened. How can you miss an elephant in the room?" The volume of his voice gradually increased as his anger came out, and the audience applauded his line of questioning.
Another shareholder, Ted Peterson, added further rhetorical flourishes, and raised more concerns that the people in the room – representing the bank's 2.8 million shareholders – clearly agreed with.
At the last general meeting in November, he had attempted to persuade Sir Victor and Eric Daniels to give up the deal, but found the responses he got were "evasive", he said.
"We tried to warn you. Now we are disappearing behind a vortex you created yourselves."
Although Sir Victor pointed out that the vote to back the deal at the time was 96 per cent in favour, Mr Peterson pressed on, suggesting that those representing the institutional investors who make up the vast majority of the voters have different views.
"Fund managers support the grandiose plans that boards often come up with – and your remuneration packages.
"You must hate AGMs, as much as you enjoy lunching with fund managers," he added – this jab raising more appreciative applause.
"You ignored us, patronised us, and hung us out to dry," he cried. Knowing he was unlikely to be satisfied, he nonetheless had his say: "There were no pay rises for the board but no cuts either. Would your CEO please return your cheque?"
OF COURSE, Mr Daniels did not seem to be in the mood for returning cheques. With his steely manner, he robustly defended the takeover.
He said it was still a good deal, arguing that Lloyds TSB got HBOS cheaper than it was worth, even having to take into account the £14 billion of bad debts the group had to write off as a result. One day, the bank would be the biggest in Britain. They would thank him when it was all said and done, he seemed to say.
But nor was Mr Daniels in the mood to get too close to the people. Unlike a meeting hosted by Royal Bank of Scotland at the General Assembly in Edinburgh last year – which was similar in its outpouring of shareholder grievance – no-one from the board mingled with the sometimes surly crowd.
Where RBS's new chief executive Stephen Hester had made a point of glad-handing shareholders, only Susan Rice, Lloyds TSB Scotland's well-kent face, made a show at the reception before and after. The rest of the board appeared like ghosts out of nowhere at the podium then were whisked away quickly afterwards.
What neither Mr Daniels nor Sir Victor seemed to answer adequately was: why didn't you tell us what we were in for?
At the meeting, both Mr Daniels and Sir Victor said they had known exactly what they were getting – HBOS warts and all. But there is a question now as to whether, in November, the board had adequately warned the shareholders what was ahead.
If the temperature of the meeting was anything to go by, most were completely unaware – or if they had suspected what was going to happen, their vote had made not a whit of difference to the board's actions.
Which brings us to those ponies …
