HBOS to seek investor ok for rights issue

Wed Jun 4, 2008 7:35am BST

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LONDON (Reuters) - Mortgage lender HBOS HBOS.L said it will seek investor approval for its 4 billion pound rights issue on June 26 and trading in its nil-paid shares will start the next day.

HBOS, owner of the Halifax, said publication of its prospectus for the rights issue is expected in the week starting June 16.

The deadline for acceptances of the underwritten rights issue is expected to be July 18 and the rights issue shares are expected to be admitted to trading on July 21.

HBOS will follow its rival Royal Bank of Scotland (RBS.L) in tapping shareholders for cash. RBS is raising a record 12 billion pounds from its offer, which closes on Friday. Bradford & Bingley BB.L is also seeking to raise 258 million pounds from a rights issue expected next month.

Banks are raising capital to rebuild balance sheets that have been dented by writedowns on assets hit by a global credit crunch and as they face a tougher economic outlook.

(Reporting by Steve Slater; editing by Sue Thomas)

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