The Treasury has further sold down its stake in Lloyds Banking Group, and has committed to a retail share sale within the next 12 months as the bank’s share price continues to recover.
The government said this morning that its stake in the lender now stands below 19%, following the disposal of another 1% position worth £500m.
It added that a retail share sale, promised by prime minister David Cameron in the run-up to the general election, will open to investors “in the next 12 months”.
Cameron said last month that a £4bn sale would offer Lloyds shares to retail investors at a discount to market prices. The offer forms part of the government’s March 2015 Budget commitment to sell a further £9bn of its stake in the bank.
Today’s announcement follows a fresh rally for Lloyds shares after the Conservatives’ election victory.
The bank’s shares rose 13.4% last month to close at 87.8p on 29 May – a further move up from the 73.6p average price at which the government bailed out the lender during the financial crisis.
A total of £10.5bn has now been raised from the government’s sale of Lloyds shares, with £3.5bn of that amount coming through UK Financial Investments’ ‘trading plan’ launched in December 2014.
The plan, which sees Morgan Stanley act as a broker on behalf of the Treasury, was due to end on 30 June 2015 but has today been extended to 31 December.
The Treasury said today that shares have been sold through the trading plan for an average price of over 80p, above the average 73.6p originally paid for the shares.
Chancellor George Osborne said: “We have now recovered over £10.5bn in total, more than half of the taxpayers’ money put into Lloyds, and we now own under 19% of the bank.
“But we are determined to get on with the job of returning Lloyds to private ownership.”
