Lloyds halfway out of bailout with £10bn sale

Tim Wallace
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Lloyds’ position compared positively to that of RBS (Source: Getty)
More than half of the government’s stake in Lloyds has now been sold back to private investors, raising more than £10bn for the Treasury so far, the government announced yesterday.
The latest sale of £500m of shares takes the taxpayer’s stake to below 20 per cent, compared with 41 per cent when the bailout took place in 2008.
As a result, the government has sold a five per cent stake in the past three months, as shares are trickled out when the price is sufficiently high, rather than sold off in big chunks.
When the fees paid from Lloyds are taken into account, the Treasury has recouped around £13bn so far.
And it is set to receive more than £100m from the dividend payment, assuming shareholders approve the payout at the annual general meeting tomorrow.

However, the sums do not include the cost of the debts incurred on the £20.3bn, which was borrowed to bail the bank out during the financial crisis.
Lloyds’ position compared positively to that of RBS, as the government still owns 81 per cent of the bank, and has not sold down any of its stake.
While Lloyds’s shares are trading at 87p, well above the 73.6p bailout price, RBS’ are stuck at 351p, below the 500p breakeven price the government needs to sell them at a profit.
So far, RBS has given the Treasury £4.3bn in fees.
Meanwhile, Northern Rock has returned £7.5bn to the government in dividends and asset sales against its loan of £21.7bn, and Bradford and Bingley has paid £4.5bn of its £27bn loan.

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