Lloyds set to unveil payout

Lloyds Bank is expected to set out its dividend plans next week, including a potential return of surplus cash to shareholders, making its stock more attractive ahead of a possible sale to retail investors, industry sources have said.

Britain’s Chancellor George Osborne said in June he would sell part of the government’s remaining 15% stake in Lloyds to retail investors in the next 12 months, in a sale reminiscent of the 1980s privatisations of British Gas and British Telecom under then prime minister Margaret Thatcher.

Lloyds’ potential dividend yield and prospects for special one-off payouts would be a big part of the stock’s appeal to retail investors, many of whom look for shares to provide income.