The British Government has sold another £500 million-worth of shares in Lloyds Banking Group, taking its stake in the lender to below 23%.
In addition to the dividend announced by Lloyds last month, the latest transactions mean the Treasury has now recovered about £8.5 billion of the £20 billion injected into the group at the height of the financial crisis.
The shares were sold at a level above the 73.6p average price the previous government paid for them. Lloyds shares opened today at 81.4p.
A pre-election sale of shares in Lloyds to ordinary members of the public was ruled out last year by Chancellor George Osborne.
The Government has chosen to sell the stock over time ”in an orderly and measured way” rather than through large tranches, as has been done previously.
It said in December that it hoped to sell off a stake of up to 5% in Lloyds Banking Group over the following six months to raise about £3 billion.
The stake is now 22.98%, compared with 40% at the time of the bail-out in 2008. Lloyds is required to issue a notification to the stock market every time the Government’s shareholding in the bank crosses through a one percentage point threshold.
Mr Osborne said: “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 the national debt.”
Lloyds Banking Group has announced it will pay a dividend to its three million shareholders for the first time since its taxpayer rescue.
The landmark in the lender’s recovery, resulting in payments totalling £535 million, came as it announced a four-fold rise in annual profits to £1.8 billion.
The dividend will provide the Government with at least another £100 million this year.
A Lloyds spokesman said: “Today’s announcement shows 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 low-risk and customer-focused bank that is committed to helping Britain prosper.”