Judge dismisses claim

Lloyds shareholders lose £385m legal battle over HBOS deal

Lloyds Banking Group

Lloyds welcomed the decision (pic: Terry Murden)

A group of Lloyds shareholders have lost a legal claim against the bank over its acquisition of rival HBOS at the height of the financial crash.

A judge dismissed the £385m High Court case brought by 5,803 former Lloyds TSB shareholders who claimed they had been “mugged” by the 2009 deal.

They alleged the merger had gone through without Lloyds revealing the dire financial circumstances of HBOS which had been formed through the merger of Halifax bank and Bank of Scotland.

In 2009 Lloyds was forced to accept a bail-out from the taxpayer as the banking sector was engulfed in a sea of debt and scandal.

The claimants sought to make five Lloyds directors, including then-chairman Sir Victor Blank and former CEO Eric Daniels, personally liable for the damages.

But Judge Alastair Norris said he was not convinced that “failures to provide sufficient information were in fact causative of any loss”.

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