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Hornby told shareholders HBOS would double mortgage share

Former HBOS chief executive Andy Hornby pledged to double mortgage market share in 2007 but told MPs last week he had tried to limit growth during his tenure.

Hornby told the Treasury select committee last week that after becoming HBOS chief executive in September 2006, he “pulled back” mortgage lending share from 14 per cent to 8 per cent in 2007 and stopped share-buyback programmes in an attempt to curb HBOS’s risk position.

But in the HBOS Earnings’ Presentation to shareholders in August 2007, Hornby said HBOS would regain as much as a 20 per cent share of the mortgage market. Falls in HBOS’s market share around the time were attributed to a failed retention strategy rather than a deliberate reduction.

In a presentation to shareholders in August 2007, Hornby told shareholders that HBOS would “continue to use share buybacks as appropriate”.

Hornby also told MPs that HBOS “recognised the wholesale markets were getting a lot more difficult” during his tenure as chief executive.

At the 2007 presentation, when questioned by Credit Suisse analyst Jonathan Pierce about concerns of a £20bn HBOS investment in US asset-backed securities, chiefs were confident on liquidity issues. Former HBOS chief executive for strategy and international Colin Matthew said: “We don’t have any issues at all. None.”

Hornby added: “You can sleep in your bed at night, Jonathan.”

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