The Treasury minister Lord Myners has defended the secrecy surrounding the £61.6bn Bank of England loans to HBOS and the Royal Bank of Scotland.

Lord Myners told Today presenter John Humphrys that it was "absolutely vital" that such operations should be undertaken covertly and rejected assertions that the secrecy surrounding the loans could have led to the high street banks "cooking the books".

And he admitted that "we know realise how very, very close we came to meltdown".

The existence of the loans was revealed yesterday by the Governor of the Bank of England, Mervyn King, and has brought criticism from opposition politicians and some shareholders in Lloyds, which was taking over HBOS at the time.

Lord Myners said the loans, made in the autumn of 2008, were kept a closely guarded secret. But he added that the board at Lloyds Bank and its advisers were kept fully in the picture.

"The board of Lloyds bank was fully in the picture," he said. "They knew exactly how much support HBOS was receiving, as did their advisers and their legal advisers, and they concluded that it still made a considerable amount of sense for Lloyds and HBOS to merge."