Trustess argue HBOS deal will jeopordise pensions

Grovelawn Financial News 06/01/2009

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Fellow trustess will block £33billion deal

A campaign led by Roger Boyes is hoping to challenge the £33 billion take over of HBOS by Lloyds TSB. Mr Boyes and his fellow trustees have voiced their concerns over the HBOS pension fund which they fear will not be paid in full to the 79,000 staff entitled to pay outs.

Mr Boyes said he felt he and his fellow trustees had no option other than to block the deal in court next week. They are concerned that the HBOS assets which underpin the scheme will be removed and placed within parts of Lloyds or sold off.

The HBOS scheme pays out pensions to 15,000 people with another 64,000 other past and present employees. The trustees are concerned that the shortfall in the fund could be as much as £5 billion. Lloyds has refused to issue a group wide guarantee for the scheme currently run by HBOS.

Stuart Stephen, the pensions head at Lloyds said, “Finding a long term solution for the benefit of the group and all its pension schemes is preferable to a short term solution that may not turn out to be to everyone’s advantage.” Lloyds says that HBOS trustees will be able to put their case forward once the take over deal has been finalised, they would be able to call in the Pensions Regulator, or can call for a fresh valuation.

Shareholders have agreed the takeover bid conditions and the are in the final stages of capital raising.

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