Lloyds Share News (LLOY)

Chancellor Alistair Darling today defended the decision to keep secret £61.6bn of loans to Royal Bank of Scotland and HBOS during the height of the credit crunch in 2008, claiming their disclosure would have "seriously jeopardised" the UK financial system.News of the loans only came out yesterday, when the revelation by Bank of England governor Mervyn King left MPs incredulous. "The Bank's assessment at that time was that it was vital that their emergency liquidity assistance operations remained confidential, and that any disclosure or leak of the operations would seriously jeopardise the financial stability of the system as a whole. I shared this assessment," Darling told Parliament today.Lending to HBOS, now part of 43% state-owned Lloyds Banking Group, began on 1 October 2008 and peaked at £25.4bn on 13 November. All the money had been paid back by 16 January 2009. Lloyds announced plans buy HBOS on 18 September, raising questions over whether its management knew the level of support HBOS was receiving and, if so, why Lloyds shareholders were not informed about it before the deal went through.The bank is currently trying to raise £13.5bn through a rights issue at 37p to cover realised and possible losses, most of which stemmed from HBOS.