SUNDAY 6th FEBRUARY 2000; A Last Minute Intervention from Lloyds?

The Sunday Times has an "exclusive"- Lloyds/TSB are going to bid for one of the Scottish banks and throw a last minute spanner in the works. If it is true, I suppose they could have genuine reasons, or it could just be a spoiling tactic. More delays would sap our strength and morale further, and ultimately Lloyds might prefer a weakened stand alone NW than a powerful, large, new competitor.

Not that I know anything, but it sounds a bit unlikely. Lloyds are still performing very well and this would seem to be an unnecessary distraction for them. However, the Times also has a very positive interview with Gordon Pell. He comes across very well, and the article concludes with a quote from a fund manager saying that although he is not particularly charismatic, his Lloyds background and ability means that "he knows how to run a big bank better than the guys from Scotland". Another boost comes from John Jay is his column; he comes down in favour of NatWest-"investors....may be best advised to stick with the home team, let it restore its business to health and then develop a growth strategy."

The Telegraph has an article headed "Bloodbath at the banks", the premise of which is that the City basically hates the entire sector, not just NatWest. Investors want cash to invest in telecom companies and dot.coms, and fear that the Internet and new competitors will hit margins in the sector, which is probably true.

Overall, we have come a long way with some of the key journalists in persuading them of the potential integration risks, and of our new strategy. Gordon has certainly been a great asset. But it doesn't appear at the moment that the press comment is translating into positive noises from the big investors - and they are the people who ultimately matter.