Mandelson approves Lloyds-TSB merger

The Secretary of State for Business Peter Mandelson has had to address reservations from the Office of Fair Trading as he pushes through the merger of Lloyds TSB and HBOS.

The OFT has looked into the proposed deal, first-announced on 18 September, under which Lloyds will buy HBOS at the Government’s behest as a means of keeping the latter afloat. The antitrust watchdog concluded the deal creates competition concerns in personal current accounts, banking services for small businesses and the mortgage market.

However Lord Mandelson has let the deal through on the grounds of public interest.

“I recognise that there are some concerns about the possible effects of the merger on competition, as set out in the OFT’s report,” said Lord Mandelson in a government press release, adding however he is “satisfied that on balance the public interest is best served by allowing this merger to proceed without a reference to the Competition Commission.”