THE Government’s stake in Lloyds Banking Group has been slashed to less than six per cent following a new share sale.
The controversial £20.3 billion bailout saw Westminster acquire 43 per cent of the business when it buckled at the peak of the 2008 financial crisis.
Yesterday, the Treasury said its plan to return the group to the private sector had “passed a significant milestone”, with the Government no longer the biggest shareholder.
A total of £18bn of the public money used to fund the bailout has now been recovered, once share sales and dividends received are accounted for.
Chancellor Philip Hammond said: “Returning Lloyds to the private sector and recovering all of the cash the taxpayer injected into the bank during the financial crisis is a priority for the Government.
“Confirmation that we are no longer the largest shareholder in the bank and that we’ve now recouped more than £18bn for UK taxpayers is further evidence that we are on track to recover all of the £20bn injected into the bank during the financial crisis.”
Asset manager Blackrock is now the largest shareholder in Lloyds and Hammond aims to return the bank to full private ownership before the year is out.
The latest phase of the Lloyds trading plan was announced in October and all proceeds from sales are used to reduce the national debt.
The first phase ran from December 2014 to June last year but the latest trades were only available to institutional investors, not members of the public, as a result of market volatility.
But despite the progress with Lloyds, the Government retains a major shareholding in the troubled Royal Bank of Scotland (RBS).
The Treasury’s stake in the Edinburgh-based financial giant still stands at around £71bn and the lender has been forced to pay out more than £50bn in compensation and fines over mis-selling and rate rigging scandals.
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