But the sale of an additional 700m shares, raising around £350m, also diluted the taxpayer’s stake in the bank.
The government now holds 38.8 per cent of the bank, down from just above 39 per cent before the extra issuance. Lloyds’ share price climbed 3.45 per cent despite the rise, hitting 49.13p.
Markets had been forewarned of the move in the bank’s full year results, and a similar round of equity issuance happened this time last year.
The shares have equal treatment with existing shares.
They represent an increase of 1.1 per cent on the bank’s existing ordinary share capital.
The move comes shortly after the Bank of England warned lenders to raise more capital and take a more conservative view of the riskiness of their loans.