Latest Lloyds share sale cuts taxpayer stake below 7%

The UK government has sold off another chunk in taxpayer-backed Lloyds Banking Group, reducing its stake to less than 7 per cent.

The Bank of Scotland parent is now less than 7% owned by the taxpayer. Picture: Jane Barlow

UK Financial Investments, which manages the taxpayer stake in Lloyds, cut its holding in the lender to 6.93 per cent from 7.99 per cent – less than a month after the last share sale.

More than £17.5 billion has been returned to government coffers since the Bank of Scotland owner’s £20.3bn bailout at the height of the financial crisis. All proceeds from the share sales are being used to reduce the national debt.

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The government has progressively sold down its original 43 per cent stake in Lloyds but in October Chancellor Philip Hammond ditched plans for a share sale to the public, opting instead to offload the holding to institutional investors.

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A Lloyds spokesman said: “Today’s announcement shows the further progress made in returning Lloyds Banking Group to full private ownership and enabling the taxpayer to get their money back.

“This reflects the hard work undertaken over the last five years to transform the group into a simple, low-risk and customer-focused bank that is committed to helping Britain prosper.”

Lloyds said in October that it had set aside another £1bn to cover compensation claims for the mis-selling of payment protection insurance (PPI) as it attempts to draw a line under the scandal.