Lloyds share price falls as government sells off one per cent stake
Shares in Lloyds Banking Group opened at 80.9p this morning, 0.6 per cent lower, after the government announced it had sold off another one per cent stake in the bank, worth £500m.
The sale means the stake owned by UK Financial Investments, the government body formed to manage part-nationalised banks, is now a relatively modest 22.9 per cent, down from 40 per cent back in 2009.
That's in contrast to Royal Bank of Scotland (RBS), in which the government still owns a 79 per cent stake. Last week, the chancellor said he wanted to "get moving" on a sale of the bank as quickly as possible, telling the FT:
I think people want to see they get their money back. The British taxpayer wants to feel they haven't suffered some enormous loss … [a privatisation] is certainly something I would want to get moving on in the summer after the election. I would want to see a review on a plan for disposal.
Last month, Lloyds announced plans to resume dividend payments for the first time since its government bailout, pushing shares up two per cent. The bank also posted profits before tax of £1.7bn for 2014, significantly up from the £415m it posted in 2013.
This morning the bank said in a statement that the sale "shows further progress made in returning Lloyds… to full private ownership and enabling the taxpayer to get their money back".
George Osborne added:
These sales are part of our plan to return Lloyds to the private sector and get taxpayers' money back. The proceeds will be used to reduce national debt.