Treasury cuts taxpayer’s stake in bailed-out Lloyds by further 1 per cent


Lloyds Banking Group

The UK Government has sold-off another chunk of its stake in Lloyds Banking Group.

Cut by a further percentage point, the UK taxpayers now own just under 7 per cent of the Edinburgh-based group.

Lloyds, which includes Halifax and Bank of Scotland, was bailout-out at the height of the financial crisis in 2008 when the UK Government to a 43 percent stake in the stricken lender for in excess of £20 billion.

The latest 1 per cent stake to be sold is worth around £400m at current market value, meaning the shares are trading at around 60p, well below the 73.6p “break-even” price for the Treasury.

The group said more than £17.5 billion had now been returned to the taxpayer and the latest announcement “shows the further progress made” returning it to full private ownership.

The Treasury holding in the group has been gradually reduced.

Over the course of a trading plan from December 2014 it was cut back from 24.9 per cent to 9.2 per cent, with the shares sold for an average of more than 80p.

This was suspended over the summer but was resumed last month even though the share price is much lower.

The Government’s stake has now been cut to 6.93 per cent.

A plan for a share sale to the public, instead of exclusively institutional investors has been abandoned.

Meanwhile, Barclays, another of the UK’s major banks still suffering the consequences of pre-crisis mismanagement, is to sell its French retail banking business to AnaCap Financial Partners as it continues to sell off noncore assets.

The deal – for an undisclosed sum – will see the lender shed 74 retail branches and a life insurance business as well as wealth, investment management and brokerage operations.

It means Barclays has now completed its exit from consumer-facing banking in continental Europe, following as it does similar sell-offs in Spain and Portugal.

Barclays has also sold its stake in Barclays Africa, and offloaded its Egyptian operations and its wealth and investment management business in Singapore and Hong Kong

The moves are part of Barclays strategy to focus on its core UK and US banking operations

However, it will retain its corporate and investment banking business in France.

Boss Jes Staley said: “This is another positive step in reducing our non-core unit, creating a more focused, simpler Barclays and thereby releasing the strong performance of our core business.”

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