In our High Street, at what are now Nos. 176 to 182, the Halifax, which was once owned by HBOS, is now, like HBOS, owned by Lloyds TSB. They are right next door to each other, and thus ripe for a physical as well as the finacial and management merger which the government imposed upon them last Autumn.

This ability to knock the wall through is probably the only bit of good news the government will have on this topic for some time, as Lloyds Banking Group shares fell yesterday by 35 per cent to 59.3p.

It turns out that HBOS had suffered a record £10bn loss in 2008, triggering a share price collapse for the combined bank. The losses at HBOS were £1.6bn higher than Lloyds claim they had anticipated. Vince Cable has warned that HBOS losses risked “dragging down Lloyds too” and has said there remained the “suspicion that Lloyds had their arms twisted into taking HBOS on”. It seems an age ago when I could write about Lloyds as a bank with underlying profits for 2007 of £3.92bn, and shareholders having enjoying a dividend of 35.9p a share. Yet that was only 12 months ago.

Since then, Lloyds Banking Group have become a massive presence in the High Street. The government has unconvincingly claimed that no pressure had been applied to Lloyds to take HBOS over: they claim the bank made a “commercial decision” to rescue it following the banking sector bail-out in October.

The government, however has a 43.5% shareholding in the combined group, which makes the claims seem more than a tad thin to me.

Ken Clarke has joined Cable in hitting out at the government, calling the merger a “disaster”. He did not, however, demonstrate much knowledge wherof he spoke, as he described Lloyds TSB as "a boring bank, it was a steady bank, it hadn’t done silly things.”

Well, in its growth it did buy up about 50 banks or so, prior to taking on HBOS, and wrecked the Cheltenham and Gloucester in the process, but that was in another age, when banks made profits from such activities.