Lloyds TSB has signalled its determination to see off demands from the trustees of the HBOS pension scheme for greater security for retirement benefits once its acquisition of the ailing mortgage lender is complete.

It emerged yesterday that the HBOS trustees intend to use their status as one of the largest creditors of the company to challenge the Scheme of Arrangement under which the bank is to be acquired by Lloyds.

The trustees are not seeking additional cash but want the combined parent company to stand behind the pension promises, rather than the proposed structure that leaves subsidiary companies as guarantors of retirement benefits.

Financial Times