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The former chair of the Lloyds Banking Group was forced to resign following the intense criticism of his deal between Lloyds TSB and Halifax Bank of Scotland.
Who's this guy?
He is the former chairman of the Lloyds Banking Group. He became Lloyds chairman in May 2006 and he is best known for his takeovers - he specialised in corporate law and co-wrote a textbook on takeovers and mergers during his time at law firm, Clifford Chance - and being one of UK prime minister Gordon Brown's favourite businessmen.
So what's he done?
Last month Blank was forced to resign as chairman following intense criticism of his famously brokered deal between Lloyds TSB and the Halifax Bank of Scotland (HBOS). Lloyds paid $21.8bn for its distressed rival and created the Lloyds Banking Group in January.
At the time, Lloyds was standing out head and shoulders above its competitors, largely because its conservative guidelines had meant it had stayed well away from the so-called toxic securities. HBOS, Britain's largest home lender was, however, on the brick of collapse.
Blank was a key mover in the takeover, which only went ahead after Gordon Brown reassured the Lloyds chairman at a cocktail party that he would waiver the competition rules to allow the creation of a dominant domestic retail bank.
What went wrong?
The takeover left Lloyds saddled with billions of dollars of losses from HBOS's risky loan book. Blank claims that at the time he had little idea about how much trouble HBOS was in. And to make matters worse, Eric Daniels, Lloyds CEO, has since admitted that they didn't carry out a full due diligence investigation before the deal.
Criticism of Blank and Daniels started to escalate as the UK's economy worsened. Last year HBOS made pretax losses of more than $15.5bn due to write-offs of property loans and a fall in property prices. This in turn raised concerns that Lloyds' strong balance sheet had been affected by the takeover.
What happened next?
Well, Lloyds had obviously been affected; the group has issued two profit warnings in five months. Most recently it warned that bad debts would increase by more than 50 percent to an estimated $21.7bn because of the recession. Lloyds said that 83 percent of the toxic assets came from HBOS's lending books.
In October, the British government was forced to step in and rebuild the group's capital and insure its toxic assets, giving it a 43 percent stake in the firm. Five months later it increased its stake to 65 percent (77 percent including non-voting preference shares).
So he was forced to quit?
Yes, but that's not it. Blank was also heavily criticised for proceeding with bonus payments of $186.3m, despite the takeover. In May he announced he would be stepping down in June 2010. In a statement he said he would continue working until his successor was appointed "to ensure the successful integration of the two banks."
