A legal challenge against the decision to waive competition law to allow the planned merger of HBOS and Lloyds TSB was rejected.
The Merger Action Group (MAG), a group of businessmen, bank customers and shareholders opposed to the proposed takeover, wanted the decision referred back to Business Secretary Lord Mandelson, and then put to the Competition Commission.
They claimed Lord Mandelson was constrained by the stated position of the Chancellor of the Exchequer and the Prime Minister over the matter.
The Competition Appeal Tribunal issued its verdict on the challenge after two-day hearing in central London held under Scottish law.
During the tribunal, MAG's chief counsel, Ian Forrester QC, claimed the decision was effectively made Government policy before landing on Lord Mandelson's desk.
The panel of three legal and economic experts also heard there was concern that the super-bank would put profits ahead of winning new customers.
Speaking after tribunal chairman Mr Justice Gerald Barling confirmed the appeal had been dismissed, HBOS head of communications Shane O'Riordain said: "We have never believed this appeal had any merit whatsoever.
"It is an unnecessary and unhelpful distraction. We look forward to our general meeting on the 12th, which we believe will be good and constructive. We are very pleased with the outcome."
In the recent judgment, Mr Justice Barling said the evidence was "all one way". He added: "There is simply no basis for the allegation that the issue of the continuing need for the merger was not properly considered by the decision-maker."
