Banking in Scotland has seen many remarkable events, but few more astonishing than the intervention of Sir Peter Burt and Sir George Mathewson aimed at halting the proposed takeover of HBOS by LloydsTSB. The battle for the future of HBOS is turning into as big a struggle as was the campaign to save RBS from HSBC 25 years ago.

The men are heavyweights of Scottish banking. Indeed, through Sir Peter's management of the Bank of Scotland into a merger with Halifax Bank and Sir George's stewardship of the Royal Bank of Scotland into a takeover of NatWest, they are in the world league of banking big-hitters.

So their demand that the HBOS board sack Andy Hornby, chief executive, and Lord Stevenson of Coddenham, chairman, and bring in them demands respect, especially as Sir Peter and Sir George were “opponents, not enemies”, in Sir Peter's words, in the battle to take over NatWest.

Sir Peter is a patriotic Scot but a long way from the nationalism espoused by Sir George. Speculation that the hand of Alex Salmond, the First Minister of Scotland, is behind this is wide of the mark. Sir Peter is nobody's political tool. The letter to the HBOS board, which they have published, makes it clear that this is about shareholder value and their clear conviction that HBOS shareholders are being sold short by the Lloyds TSB deal.

They are saying to shareholders that the present chairman and chief executive are incompetent, they cannot be trusted to make the best decision for shareholders, so sack them and put us in. Then they envisage taking a hard forensic look at the business and producing recommendations on the way ahead. Although the goal is to produce a business plan for a value-creating standalone HBOS, the letter also says that a takeover, perhaps by LloydsTSB or possibly by some other bank, might be best. It cannot be assumed that the two men would end up preferring one outcome over another.

This move has nothing to do with the takeover sought by Jim Spowart, former chief executive of Intelligent Finance, HBOS's internet banking unit. The as yet unnamed foreign bank has still to decide whether it will table a rival bid. If it does, Sir Peter and Sir George's position will be unchanged.

It would be a surprise if the LloydsTSB move is rejected outright by shareholders, especially big pension funds. While they supported September's initial rescue takeover by LloydsTSB, they have grown uneasy as the bank has cut the value of its offer, which would be diluted further by a government shareholding. The value has fallen from £12.2billion to just over £6billion.

The letter to the HBOS board is a concise analysis of why the Lloyds TSB bid is bad value. It also lays out a compelling argument why Lloyds TSB is in worse shape than HBOS and even goes on to suggest that it is Lloyds TSB, not HBOS, which would require more government aid if the takeover does not proceed.

This puts Gordon Brown and Alistair Darling in a tricky place. They are not yet shareholders in either bank. That will occur only when the existing shareholders have rejected the rights issue of more shares and the Government has to take them up, an event likely to occur in January.

They want to risk as little taxpayers' money as possible while ensuring the stability of the banking system on one hand and to save banking jobs and the future of Edinburgh as a financial centre on the other.

So when they say that it is for shareholders to decide, they mean it. Far better for them that responsibility for job losses will be on shareholders' shoulders, not theirs. Since that would be even more clearly the case if Sir Peter and Sir George moved in to run HBOS, they may privately be behind them.

­ Peter Jones is a financial commentator and Scottish correspondent for The Economist

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