Lloyds Banking Group Plc rejected an offer from a claimant group to settle a legal dispute regarding the bank's takeover of HBOS Plc in 2008, Sky News reported, citing sources.
The Lloyds Shareholder Action Group, which consists of 6,000 former investors in Lloyds TSB, informed the lender in the week beginning Oct. 9 that it would drop its claims against the bank in return for a payment of about £500 million, according to the sources. The group argues that shareholders were "duped" into purchasing HBOS.
However, the bank immediately rejected the offer, which was sent by the group's law firm Harcus Sinclair, the sources added. A spokeswoman for Lloyds said the claims had no merit and would be defended vigorously.
A 14-week trial over the matter is scheduled to begin Oct. 18 at the High Court in London, with "a person close to the situation" saying there is little chance of another settlement proposal being offered before it gets underway.