Did you find the solution? if not then here it is..try this

a) Create the sample table holiday :
create table holiday (h_dt date h_desc varchar2(100));

b) let us feed some records;

Insert into holiday values ('1-jan-2007' 'New Year');
Insert into holiday values ('8-oct-2007' 'Columbus day');

c) Querying holiday table you will find :

H_DT H_DESC
--------- -------------
01-JAN-07 New Year

08-OCT-07 Columbus day

d) PL/SQL code to get the date
------------------------------------------------------------------
Declare

in_dt date : '&Dt'; --input date goes here
v_dt date;
v_chk number;

begin

<<start_here>>

select count(1) into v_chk from holiday where h_dt in_dt;

if v_chk > 0 then
in_dt : in_dt-1;
goto start_here; --Loop to check consecutive holidays
end if;

select decode(to_char(in_dt 'DY') 'SUN' in_dt-2 'SAT' in_dt-1 in_dt)
into v_dt from dual;

dbms_output.put_line(v_dt);

end;
/

------------------------------------------------------------------

e) Output :

SQL> @lastbusiness
Enter value for dt: 8-Oct-2007
Result : 05-OCT-07

SQL> @lastbusiness
Enter value for dt: 2-Jan-2007
Result : 02-JAN-07

SQL> @lastbusiness
Enter value for dt: 1-Jan-2007
Result : 29-DEC-06