Gordon Brown has dismissed calls for Lloyds TSB's takeover of HBOS to be scrapped.

Despite reports that the Bank of China is in early talks over backing a rival offer for HBOS, the Prime Minister said there was only one "realistic" option for the struggling high street giant.

Mr Brown's comments came after two senior bankers announced their opposition to the merger, claiming it would be bad for shareholders and kill competition.

Sir George Mathewson and Sir Peter Burt - former chief executives of Royal Bank of Scotland and HBOS respectively - have appealed to shareholders to back a boardroom coup putting them in charge.

But the Prime Minister said: "The problem is that apart from Lloyds TSB no serious bid that is funded has actually come forward.

"There has been no announcement by any financial institution that it is prepared - apart from Lloyds TSB - to take on the problems as well as the opportunities of HBOS. I think people have got to be realistic about that."

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