Herbert Smith has advised Halifax Bank of Scotland (HBOS) on its first bond issues since its formation last September with the merger of Halifax and Bank of Scotland (BoS)
The deal involved two separate issues. The first was a £600m tier-one issue for HBOS Capital Funding and the second was a j500m (£308.8m) upper-tier-two issue for HBOS. It is an important instruction for Herbert Smith because it consolidates the firm's relationship as external counsel for the new entity in capital markets. Following the merger of the two banks, Halifax's head of legal Harry Baines was selected to head the in-house department of HBOS and Halifax's firm of choice was Linklaters. It is understood that HBOS is examining its existing relationships with a view to cut dramatically the number of firms it uses. Herbert Smith finance partner Jane Borrows, who led the deal, said that it will form a benchmark for future deals. Herbert Smith has a longstanding relationship with BoS and its corporate department advised the bank on the merger with Halifax. The bond issues are the second transaction that the firm has handled for HBOS. In November, it advised the bank and its subsidiary MGR Capital on the £330m acquisition of Rover Financial Services. However, the instruction on the financing side puts the firm in a good position as a full service adviser. Bank of Scotland also has close links with Allen & Overy, DLA and Tods Murray. HBOS was unavailable for comment when The Lawyer went to press.