Britain's government is selling off the rest of Lloyds next spring

AntonioGettyLloyds CEO Antonio Horta-Osorio has a lot to smile about.

Lloyds Banking Group will be fully privatised once again next year after the British government revealed that it plans to sell off its remaining stake in 2016.

The UK Treasury said in a regulatory statement of its “intention to fully exit from its Lloyds shareholding in the coming months, and as part of this … shares will be sold to retail investors.”

It will sell a £2 billion ($US3 billion) slice of its remaining 11.98% stake in the bank to retail investors in the spring next year, without giving a specified date.

Lloyds received £20.5 billion ($US31.4 billion) in state handouts between 2008 and 2009 following the credit crisis. In return, the government held a 43% stake in the lender and it has steadily chipped away at its holding.

It has since sold off large chunks of the bank back to institutional investors in the private sector over the last two years.

In December 2014, Osborne launched a trading plan that allows people to buy the Lloyds stock for for an average price of over 80p, well above the average 73.6p originally paid for the shares. It was due to end no later than the June 30, 2015. However, the plan is now being extended until December 31, 2015.

The Treasury’s announcement today confirms that the government is ready to sell off the rest of its stake in 2016 but it did warn that this would still depend on “market conditions.” In other words, if the stock market is performing badly or Lloyds shares look too volatile, it may hold off on the share sale.

It added that the money raised in the Lloyds stake sell-off will go towards paying down the national debt.

Retail investors will be able to buy Lloyds stock by online and post applications. Members of the public will be offered a discount of 5% of the market price, with a bonus share for every 10 shares for those who hold their investment for more than a year.

NOW WATCH: Floyd Mayweather just spent $US4.8 million on one of the fastest cars in the world

NOW WATCH: Money & Markets videos

Want to read a more in-depth view on the trends influencing Australian business and the global economy? BI / Research is designed to help executives and industry leaders understand the major challenges and opportunities for industry, technology, strategy and the economy in the future. Sign up for free at