More Lloyds shares sold by the government

Posted by Tom Line in Banking on 15 May 2015 - Tom worked as a Credit Analyst at checkmyfile until 2015

The government has sold more shares in Lloyds Banking Group, taking its stake in the group to less than 20%. £500m of shares were sold by the Treasury taking the total amount recouped by the government to £10bn.

Lloyds Bank was bailed out by the government at the height of the financial crisis at a cost of £20bn to the tax payer, bringing 43% of the bank under state control.

Royal Bank of Scotland (RBS) was another bank bailed out by the government at a cost of £45.2bn, but it is not thought that RBS is close to being returned to private ownership just yet, as the government is sitting on a loss of £13.5bn on its stake at current share prices. The state currently owns 80% of RBS and recent reports suggest it may consider selling its stake in the bank at a loss.

The shares sold in Lloyds Bank made a profit, however, being sold for more than the average price paid by the government, which was 73.6p.

An upbeat chancellor, George Osborne, said, “I’m delighted that we’ve now raised over £10bn from selling our shares in Lloyds Bank. This means we have recovered over half of the taxpayers’ money put into Lloyds and now own less than 20% of the bank”.

In his last budget, the Chancellor announced that he planned to sell at least £9bn of shares in Lloyds during this financial year, with the possibility of many shares being offered directly to the general public.

A Lloyds spokesperson said, “Today’s announcement shows the further progress made in returning Lloyds Banking Group to full private ownership and enabling the taxpayer to get their money back. This reflects the hard work undertaken over the last four years to transform the group into a simple, low-risk and customer-focused bank”.

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