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The problem with all of Crash's ideas is that it leaves the City of London and Westminster pulling the strings and frankly I do not trust either to keep to their word or to work for the benefit of the country.

Personally I would much rather see the Scottish Govt put through legislation to enable the establishment of a mutually owned Scottish bank which could take over from the failed RBS and Lloyds/HBOS organisations eventually allowing them to be effectively liquidated.

Scotland needs to be able to control its own destiny in this are and not be at the generally unsympathetic mercy of the Westminster establishment and the City of London.

More useless initiatives with soundbite names, this seems to be all this increasingly incompetent government can come up with. The way to get money into the banking system is to give those with money to invest, a rate of interest which will encourage investment; without deposits, the banks cannot lend. With deposit interest approaching zero, there is no incentive for investment, indeed it is probably better not to invest in banks that may very well become subject to the whims of the government. Giving people a few pounds off their mortgage may sound good,and may win a few votes in the coming election, but if the company they work for can't get cash from it's bank, they will have more to worry about than paying their mortgage. It seems that Brown, Darling and their pet flunkey Mervyn King are flailing around like headless chickens with no clear idea or answer to the countries problems. Playing "save the world " at European conferences and making what he thinks are statesmanlike speeches, do neither the country nor Brown himself any good. Now he commits another £20 million in aid to Gaza , where, far from helping the poor, the money will merely raise the arms purchasing potential of Hamas, a terrorist organisation.

Dougal, Florence, Zebedee and Brian had more sense and they had a "Magic Roundabout" to go round in circles.

Would that it were possible to de-couple HBOS and merge with RBS. I'm sure that the infrastructure is there, but for the catastrophic losses real or potential, which even now are still unknown. Who would have thought that the ultimate 'Big Bang' would have come from Scotland's two biggest banks exploding. When you see the resultant destruction how can Fred Goodwin morally hang on to his knighthood for 'services to banking'.

Douglas,

Poster 4 hits on a key issue here that may fall more into BrianT's territory but should still be debated here nonetheless.

This is the political significance of the demise of Scotland's two largest banks, their current use as a political football by the Labour government in the UK, the impact that must have on the SNP's timetable for independence, and the potential to recover an independent banking sector in Scotland, regardless of the country's constitutional status.

(And I say this with some not disinterested bias, since I do hold a full Scottish banking qualification).

I can take a very positive view and suggest that there are still enough quality Scottish financial institutions around, and in good shape, that could be persuaded to initiate a new bank, or at least provide finance for such a start-up. There is expertise around for such an idea, although recent experience has been internet based.

But there are at least two other options.

First, it has been rumoured for a while that the Clydesdale Bank is up for sale by its owners, NAB. Why does the Scottish Government not support a consortium of other Scottish financial institutions to initiate a buy-back? At current pricings, the cost is unlikely to be prohibitive.

Second, and this would be more difficult because of the UK government's part-ownership, a similar consortium could be constructed to buy-back the 'old' Bank of Scotland with a 'TSB add-on' and freed from Lloyds and the disaster that was the Halifax acquisition. There would be real issues with the current UK government, but that may well change in two years' anyway!

I think it is the Japanese who say that 'there is no such thing as problem, only opportunity'!

Thoughts from others?

Thanks for taking up the fiery cross #5.

It is just that as an elderly exiled Scot it breaks my heart to think of what these two great Scottish financial institutions formerly were......examples of honesty, decency, integrity, and dare I say 'prudence' in which your money was secure.

Judging by some of the reactions south of the border, we could see the prospect (perhaps within a couple of years) of the names of Bank of Scotland 'Royal' or otherwise, disappearing from commercial language altogether. What a tragedy!!

As I said in my original comment, the infrastructure is there, all we need is a change of product.

Old Habits!

Good to see exiled Scots taking part in this blog - all your contributions are needed!!

My own experience goes far back in Scottish banking having been enticed out of school at 16 to join the local bank at the invitation of the local manager!

So I feel real pain in witnessing what's happened to, as you say, two great Scottish institutions!

The Scottish banking world may have changed greatly since I attended the 'local clearing' but it now needs people of purpose and vision to propel a new banking industry for a new Scotland.

In this, people like Douglas have a huge role to play and I, for one, will support every valid and genuine move to create this new (and much needed) banking industry for Scotland.

Having said that, I trust that the interest shown by Messrs Neil, Burt and Matthewson will not be allowed to fizzle out!