EquitiesOct 9 2015

State’s Lloyds shareholding down below 11%

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State’s Lloyds shareholding down below 11%

The government has sold a further 1 per cent of its stake in Lloyds Banking Group, reducing the overall shareholding to below 11 per cent.

The sale made through a trading plan launched in December, takes the total raised for the taxpayer to £15.5bn, with all sales used to reduce the national debt.

A trading plan involves gradually selling shares in the market over time, in an orderly and measured way. The trading plan was launched on 17 December 2014 and will end no later than 31 December 2015.

Chancellor George Osborne said: “It’s fantastic news that we’ve sold more shares in Lloyds Bank, taking the total recovered for the taxpayer to £15.5 billion.

“I am determined to build on this success by making Lloyds shares available to the public next Spring, so that we can build a share-owning democracy and continue to reduce our national debt.”

Earlier this week the Treasury announced that a further retail sale of Lloyds shares to be launched next spring, with applications available online and by post.

According to a statement, it is the government’s intention to fully exit from its Lloyds shareholding, with at least £2bn of shares to be sold off in 2016. Industry experts labelled the sell-off as “pretty attractive”.

Members of the public will be offered a discount of 5 per cent of the market price, with a bonus share for every 10 shares for those who hold their investment for more than a year.

The value of the bonus share incentive will be capped at £200 per investor and people applying for investments of less than £1,000 will be prioritised.

Laith Khalaf, senior analyst at Hargreaves Lansdown, previously said: “Wild horses couldn’t drag investors away from this share sale, especially given the discounted price and the dividend stream Lloyds is expected to start churning out.

“Pensioners in particular are likely to respond to a trusted high street brand with a decent yield when interest rates are so low.”

peter.walker@ft.com