Latest Lloyds stake sale recovers further £500m

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The government has made another £500m from selling part of its stake in bailed-out Lloyds Banking Group.

The selloff reduces the government share of the group from 23% to just under 22%.

The government has been gradually cutting its stake in Lloyds down from 40% in 2009, after a taxpayer rescue pumped £20bn into the bank at the height of the financial crisis.

This latest share sale means the government has recouped a total of £9bn for the public purse since taxpayers were forced to bail out the bank.

The chancellor, George Osborne, said the proceeds of the sale would be used to reduce Britain’s national debt.

“Five years ago, we were bailing out the banks. Today, thanks to the success of our long-term economic plan, we’re selling more shares and reducing our national debt, which is now falling as a share of GDP by 2015-16,” the chancellor said.

The Treasury said the latest move was part of an orderly sell-off of the government’s stake in Lloyds. It added that the banking group’s recent decision to start paying a dividend for the first time since the crisis would hand the Treasury at least a further £100m this year.

Lloyds shares were down 1.2% at 79p in late morning trading on Thursday.

In a separate development, fellow bailed-out bank Royal Bank of Scotland increased the size of the stake that it is selling in its US business Citizens after receiving stronger-than-expected demand from investors.

RBS plans to raise up to $3.7bn from the sale, reducing its stake in Citizens from about 70% to 41.9% if the shares are fully taken up.

Powered by Guardian.co.ukThis article was written by Angela Monaghan, for theguardian.com on Thursday 26th March 2015 12.16 Europe/Londonguardian.co.uk © Guardian News and Media Limited 2010

 

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