A multimillion-pound case brought by Lloyds shareholders over the acquisition of HBOS is "fundamentally flawed at every level", the High Court in England has heard.

Lloyds Banking Group is under mounting pressure to provide an update on the leadership vacuum created by the absence of its chief executive, it was claimed today.

The chairman of taxpayer-backed Lloyds Banking Group said today he was “very confident” that its chief executive would be “back in harness” before the end of the year after taking unexpected leave of absence because of stress.

The London market slumped 2% today as the increasing likelihood of a Greek debt default shook investor confidence.

The finance boss who helped steer Lloyds Banking Group through the aftermath of its HBOS acquisition in 2008 announced plans to quit the firm today.