iNVEZZ.com, Thursday, January 2: The UK government may complete the privatisation of Lloyds Banking Group Plc (LON:LLOY) this year, with the sale of its remaining 33 percent stake, currently valued at £18.4 billion.
According to inside sources quoted by the Telegraph, the disposal of the entire stake owned by the government could involve a combination of institutional sales and a nationwide offering to the public. In September, the government sold six percent of its stake in Lloyds to institutional investors, raising £3.2 billion (Lloyds Share Price: UK Sells 6 Percent of Lloyds for £3.2bn).
This was the first sale of Lloyds shares since the bank’s £20 billion bailout in 2008. Last month, the National Audit Office concluded that that the transaction had been “effectively managed” and had provided “value for money”, although when taking into account the interest costs associated with the government-funded bailout of Lloyds the share sale actually resulted in a loss to the UK of at least £230 million.
Following the successful sale of the first batch of shares owned by the government, speculation is growing that Chancellor George Osborne could authorise a repeat sale within months, most likely following the publication of Lloyds' full-year results on February 13, leaving the door open for a larger final offering in the autumn, the Telegraph noted.
According to a source quoted by the newspaper: “Post-results is when a further institutional offering would make most sense. After that, the thinking is [that] an autumn sale, combining an institutional and a retail segment, is a realistic prospect.”
According to another insider, the full privatisation of Lloyds this year “will be largely dependent on what it says about the dividend. Positive comments could open the way for a full exit.” The bank, which has recently improved its results, is widely expected to resume dividend payouts for the first time since its rescue. Lloyds share price rose more than 60 percent last year. It closed at 78.88p on Tuesday, valuing the bank at £56.36 billion.
Westpac wraps up purchase of Lloyds’ Australian lending book
Westpac Banking Corp (ASX:WBC), Australia’s second-biggest bank, announced today that it has completed the A$1.45 billion (£780 million) purchase of the Australian commercial lending book of Lloyds.
The acquisition of Lloyds’ Australian asset finance business, Capital Finance Australia Limited, and its corporate loan portfolio, BOSI, was announced in October (Lloyds share price: Westpac agrees to buy UK lender’s Australian assets). The deal is part of Lloyds’ strategy to shrink its international presence and refocus on lending in its domestic market.
As of 8:06 UTC buy Lloyds shares at 79.69p.
As of 8:06 UTC sell Lloyds shares at 79.35p.
Prices can go up and down meaning you can get back less than you invest. This is not advice. Dealing services provided by Hargreaves Lansdown.