Government sells shares in Lloyds

<p>The latest sale reduces the government’s stake to less than 20 per cent.</p>

During the financial crisis, Lloyds received £20 billion from the UK government, giving taxpayers a 40 per cent stake in the group.

Since December, UK Financial Investments has been reducing the government's stake in the group.

Today, it was announced that another tranche of shares has been sold, returning another £500 million to taxpayers and bringing the government's stake in the bank to less than 20 per cent. To date, around £10 billion has been recouped, reports the BBC. 

This sale means that the government has a 19.3% share in the company – that number has been reduced by five per cent since the beginning of the year.

A spokesperson for Lloyds said that the sale demonstrated that progress was being made in returning the bank to "full private ownership and enabling the taxpayer to get their money back".

By comparison, Lloyds said in February it would resume paying dividends to shareholders for the first time since the financial crisis in 2008 as it reported full-year statutory profits of £1.8bn. The 0.75 pence per share dividends added up to £525 million, which was split among the bank's three million shareholders. The largest share, £130 million, went to the government.

Today, at 15:50 (BST), shares in Lloyds were up by less than one per cent to 87.23.

Royal Bank of Scotland

The BBC points out that, while Lloyds is working towards repaying its debts to the taxpayer, the Royal Bank of Scotland (RBS) – a business that also received financial assistance from the government during the financial crisis – is still far from returning to private ownership.

Around 80 per cent of RBS is still owned by taxpayers and the bank reported a loss of £446 million for the three months up to the end of March. It has been required to set aside £856 million for "litigation adn conduct charges" and it will have to pay out £453 million for restructuring costs, after having sold Citizen, a US bank.

In comparison, last year, the bank showed a profit of £1.21 billion.

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