createdb failure SCO Open Server 5.05 postgres 6.5.3

Gentlemen, how are you? Recently ported from Red Hat 5.2 to SCO Open Server
5.05; postgres version 6.5.3; postmaster was compiled with no modifications;
used configure command with --without-CXX; all compiled ok; postmaster is
running in background; initdb worked; createdb fails with :
"No pg_hba.conf entry for host localhost, user postgres, database
template1";

pg_hba.conf is identical to the one working on Red Hat 5.2 and was never
modified; entries in pg_hba.conf are:
local all trust
host all 127.0.0.1 255.255.255.255 trust

enviroment variables:
USER=postgres
PGUSER=postgres
PGDATA=/usr/oracle/pgsql (backward compatible; oracle being
replaced)
PGLIB=/usr/lib/pgsql

Works fine on Red Hat 5.2 postgres version 6.5.2 ?
Thank you for your help,
Marco Long
Software Engr. Manager
Wescom Products Inc.
Jacksonville, FL