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Lloyds shares to be offloaded by UK government in massive Thatcher-style privatisation scheme Lloyds returns £10.5bn as Osborne lifts sales
(about 11 hours later)
The government has launched another massive sale of publicly-owned shares in Lloyds, in a sell-off comparable to the massive privatisation schemes of Margaret Thatcher. George Osborne has fired the starting gun on another huge sell-off of taxpayer-owned shares in Lloyds Banking Group as proceeds from previous sales topped half of the original £20bn bailout cost for the first time.
Proceeds from previous sales have now reached half the original bail-out package of £20 billion. New plans should raise money for the government while giving some people in the UK their first taste of the stock market. The total raised should exceed the billions raised by Thatcher from the sale of British Telecom and British Gas. The Chancellor has told UK Financial Investments, the government-owned company which manages its Lloyds and RBS stakes, to continue the drip-drip sell-off of taxpayer shares through the broker Morgan Stanley. Since those sales began last December the broker has sold 4.2 billion shares in the market at an average price of just over 80p, raising a total of £3.4bn.
Chancellor George Osborne has told UK Financial Investments to continue the drip-drip sell-off of taxpayer shares through broker Morgan Stanley which began last December. Since then the broker has sold 4.2 billion shares in the market at an average price of just over 80p raising a total of £3.4 billion. That represented just over 5 per cent of Lloyds and, thanks to the reintroduction of dividend payments, the disappearance of Labour’s threat to banks at the general election and rising profits from Lloyds, the shares were all sold above the average 73.6p paid by the taxpayer in the 2009 bailout.
That represented just over 5% of Lloyds and thanks to the reintroduction of dividend payments, the disappearance of Labour’s threat to banks at the General Election and rising profits from Lloyds the shares were all sold above the average 73.6p paid by the taxpayer in 2009’s bail-out. Morgan Stanley has now been mandated to sell a further 5 per cent or so of the Government’s stake, as long as it can do so above the bailout price. After sales on Friday the stake has come down to below 19 per cent. In December it stood at just under 25 per cent.
Morgan Stanley has now been mandated to sell a further 5% or so of the Government’s stake so long as it can do so above that bail-out price. After sales on Friday the stake has come down to below 19%. It was just under 25% in December. Mr Osborne said: “The trading plan has been a huge success, with almost £3.5bn raised for the taxpayer so far. This means we have now recovered over £10.5bn in total, more than half of the taxpayers’ money put into Lloyds, and we now own under 19 per cent of the bank.
Osborne said: “The trading plan has been a huge success, with almost £3.5 billion raised for the taxpayer so far. This means we have now recovered over £10.5 billion in total, more than half of the taxpayers’ money put into Lloyds, and we now own under 19% of the bank.
“But we’re determined to get on with the job of returning Lloyds to private ownership. That’s why I’m extending the plan for six months so that we can make even more progress in returning money to the taxpayer and paying down the national debt.”“But we’re determined to get on with the job of returning Lloyds to private ownership. That’s why I’m extending the plan for six months so that we can make even more progress in returning money to the taxpayer and paying down the national debt.”
He added that this would be part of his Budget announcement that the Treasury planned to raise £9 billion through further Lloyds shares sales in the current fiscal year. That includes just over £1 billion already raised by the first tranche of Morgan Stanley sales. He added that this would be part of his Budget announcement that the Treasury planned to raise £9bn through further Lloyds shares sales in the current fiscal year. That includes just over £1bn already raised by the first tranche of Morgan Stanley sales.
The Chancellor made no mention of his pre-election pledge to offer Lloyds shares to retail investors at a 5% discount to the stock market price and with the promise of a bonus one-for-ten free share to those who held on for at least a year. That sell-off could come late this year or, more likely, early next year. Last night it was reported that the Chancellor will lay out plans for privatising the Royal Bank of Scotland in next week’s Mansion House speech. The reports suggested that the Treasury’s stake in the bank could be sold well below the 502p at which the lender was bailed out during the financial crisis.