Business Secretary Peter Mandelson today give permission for Lloyds TSB to take over major mortgage provider HBOS.

The Office of Fair Trading warned that the takeover would reduce competition in the market for current accounts, financial services to small businesses, mortgages and remortgages.

Despite this, however, the government has ruled that the rescue buyout is allowed to go ahead.

HBOS is the UK’s biggest mortgage lender, and the takeover may mean security for many mortgage-holders.