Lloyds shareholders launch legal action
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Lloyds Action Now, an association set up by shareholders of Lloyds TSB have started legal action to reclaim up to £14bn, which they claim to have lost as a result of the merger with HBOS.
The group has sent letters to the Treasury, Victor Blank and Lloyds chief executive Eric Daniels demanding compensation, giving them 90 days to respond.
In the letters, Winckworth Sherwood, the solicitors who are acting on behalf of the shareholders say they should have been made aware that the Bank of England had made an advance of £24.5bn to HBOS during October 2008 which was not mentioned to them before the agreed takeover.
It argues that by not disclosing this Lloyds TSB shareholders were misled.
A spokeswoman for Lloyds Banking Group, says: “We will robustly defend the Group’s position in the event of legal action.
“We provided thorough and appropriate information to shareholders about our liquidity position and that of HBOS including the general use of government backed liquidity schemes.
“We disclosed the fact of the support. We disclosed the fact that it was significant. We disclosed the fact that if such support was not available, there would be a material impact on the solvency of the business. That was, in the view of the Board, through and appropriate disclosure.”
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