The UK government just made a £170 million ($US265 million) profit by selling off another slice of its stake in the 20% state-owned lender Lloyds Banking Group.
An estimated £170 million ($US265 million) will be pure profit, thanks to Lloyds’ shares recovery since the bailout.
The government was forced to pump £20.5 billion ($US32 billion) into Lloyds at the height of the financial crisis in 2008 and 2009. Shares in the struggling lender were bought at an average price of 63.1p when fees are factored in. Yesterday Lloyds shares closed at 86.6p.
The Treasury still owns just under 20% of Lloyds – over 14 billion shares – but we’re likely to see more sell downs soon. George Osborne is reportedly keen to sell off the government’s entire stakes in both Lloyds and the Royal Bank of Scotland sooner rather than later – even if it means selling RBS shares at a loss.