Treasury set to offer Lloyds to general public

Tim Wallace
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INDIVIDUAL investors could get a chunk of the government’s holding in Lloyds Bank when the Treasury sells the rest of its shares, raising the prospect of Thatcher-style popular capitalism.

After the successful sale of a six per cent stake in the bank for £3.2bn, George Osborne said the remaining 32.7 per cent could go to retail investors.

“This is the first in a multi-staged sale programme,” he wrote to Treasury Select Committee chair Andrew Tyrie. “I will consider all options for later sales of our shareholding in Lloyds, including a retail offering to the general public.”

This sale was for institutional investors, mainly from the UK.

Investment banks covered their books on the sale within a few hours of its announcement on Monday, before raising the price overnight for a sale at 75p, a three per cent discount on Monday’s closing price. Analysts believe the price could be higher still in future sales. “There are positive benefits from a greater free float – Lloyds could see better funding costs with reduced state ownership, for example,” said Joseph Dickerson from Jefferies.

The sell-off could also mean a windfall for Lloyds boss Antonio Horta Osorio, whose deferred bonus of £1.5m for last year is tied to the sale and share price.