The share price of Lloyds Banking Group is down this morning (June 9th) after the company revealed it will sell shares in TSB Banking Group for between 220 pence and 290 pence.
Some 25 per cent of TSB is being sold by Lloyds in the share sale and small investors are being given the first opportunity to snap up a part of the bank.
Investors have the chance to access a deal where they can get one free share for every 20 shares they buy. They can buy stocks up to the value of £2,000 and will have to hold on to them for a period of one year after the flotation.
The final price for the share sale is set to be revealed by Lloyds on June 24th, with conditional dealings in the shares expecting to begin on the same day. Taking the mid-point of the share sale range revealed by Lloyds, TSB is valued by the bank at about £1.275 billion.
Selling shares in TSB is another big step forward for Lloyds Banking Group, which had to be bailed out by the UK's coalition government in the middle of the recession as a result of financial issues caused by the global crash.
But the share sale has been forced by European Union rules that say Lloyds has to scale back its size due to the bailout by the government. Lloyds was previously described as having been "too big to fail" in 2008 when the recession hit.
As well as Lloyds, the recession caused major problems for Northern Rock in the UK, although others such as HSBC and Barclays were able to weather the storm much better.
Shares in Lloyds Banking Group have fallen steadily this morning on the back of the announcement of the pricing of shares in TSB. By 08:20 BST, stocks in the bank were down by 0.69 per cent and were continuing to drop as the session continued.
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