Shares in Lloyds Banking Group (LON:LLOY) have gained ground in London this morning, outperforming the broader market, as the Treasury said that its stake in the bailed-out lender had dropped to below three percent. The news comes after Chancellor of the Exchequer Philip Hammond signalled last week that the government was on track to recover all the £20.3 billion it injected into the blue-chip bank during the financial crisis.
As of 08:19 GMT, Lloyds’ share price had added 0.46 percent to 68.16p, outperforming the blue-chip FTSE 100 index which has climbed marginally higher and is currently 0.24 percent better off at 7,375.52 points. The stock has recouped some of the losses posted in the previous session, when shares in Lloyds and peer Royal Bank of Scotland (LON:RBS) were sold off amid concerns that Scotland might again vote on its independence.
Lloyds disclosed in a statement this morning that the government’s holding in the group had dropped to 2.95 percent. The Treasury has been selling shares in the bailed-out lender via a pre-arranged trading plan to institutional investors, and expects to return the bank to the private sector by the end of 2017-18.
“Lloyds’ recent annual results show that we are in a good position to reduce our shareholding further and expect to recover all of the money taxpayers injected into the bank during the financial crisis,” Simon Kirby, economic secretary to the Treasury, commented in today’s statement.
The lender’s shares, however, came under pressure yesterday, along with RBS, after Scotland’s First Minister Nicola Sturgeon demanded a second vote on independence.
“Royal Bank (of Scotland) and Lloyds both have sizeable Scottish operations, so it depends what [...] ultimately happens there and whether (Scotland) actually exits the UK and stays part of Europe,” Shore Capital’s Greenwood said, as quoted by Reuters.
Lloyds and RBS had both said that they would relocate to England if Scotland voted for independence back in 2014.