Government to sell final Lloyds stake

Jessica TranterLast Update : Tuesday 17 May 2016 - 6:07 PM
Government to sell final Lloyds stake

Government to sell final stake in Lloyds Bank

Lloyds Ban exteriorImage copyright Reuters

The government will press ahead with the sale of the taxpayer’s final stake in Lloyds Banking Group this year.

The sale, which had been due to take place this spring, was delayed in January because of the turmoil on the world’s financial markets.

Now the Treasury has said it will make shares in the bank available to the public this financial year.

It added the government would fully return its remaining 9.2% stake to the private sector in 2016-17.

In a statement, the Treasury also said it would receive a further dividend from Lloyds of £130m. This latest payment brings to £318m the amount the Treasury has received in dividends from the company.

“The £130m we’ve received today marks another milestone in government’s plan to recover the money taxpayers were forced to put into Lloyds during the financial crisis,” said the economic secretary to the Treasury, Harriett Baldwin.

“The government has already recovered over 80% of its original investment in Lloyds and today’s dividend payment takes the amount we’ve recovered from the bank to over £16.8bn.”

Private investors

During the financial crisis, the government spent £20.5bn of taxpayers’ money rescuing Lloyds, acquiring a 43% share in the bank.

So far, only institutional investors have had the chance to buy the taxpayer-owned shares in Lloyds.

However, the government announced last October that it would sell about £2bn more of its shares and also hold a sale aimed at private investors this spring.

Subsequently, however, Lloyds’ share price fell and the trading environment for banks became tougher.

Ms Baldwin said, however, that she was “determined” to make “Lloyds shares available to the public this year, so that we can build a share-owning democracy and continue to reduce our national debt”.

Source: BBC Business

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Jessica Tranter