“The leading rule for the lawyer,” Abraham Lincoln said, “as for the man of every other calling, is diligence.” For the in-house legal team at Lloyds Banking Group, diligence – or its legal practice equivalent, due diligence – has been a perpetual administrative headache in the bank’s recent history.
The 2008 government-brokered acquisition of HBOS, estimated to have lost Lloyds £10bn, prompted a continuing string of lawsuits from shareholders accusing the purchaser of short-sightedness and diligence failings. Four years later, Project Verde – Lloyds’ attempt to sell off the 632 branches that later became TSB – stumbled shortly after Lloyds’ due diligence found that the buyer, The Co-operative Bank, had a major cash shortfall in December 2012.
