HBOS, the UK’s biggest mortgage lender, is to cut 425 jobs and close one of its five mortgage brands to new business as it aims to streamline costs.

The bank, which recently reported a 72% slump in first-half profits to £848m and saw its £4bn rights issue shunned by most investors, said the shake-up was aimed at reducing duplication between brands.

It comes weeks after HBOS said it would consider disposals or winding down businesses as it positions itself for a shrinking mortgage market and a fall in house prices of up to 20%.

HBOS will also stop offering conventional mortgages through its Intelligent Finance brand. In future, borrowers wanting to take out a home loan with IF will also have to take out a current account alongside a savings account.

Financial Times