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Government sells £500m Lloyds stake

The taxpayers' stake in Lloyds Banking Group has fallen to below 16% after the Government sold off another tranche of shares.

It means the Government has now recouped around £12 billion of the £20.5 billion spent bailing out the lender at the height of the financial crisis in 2008.

The Treasury has reduced its stake by nine percentage points over the last five months as part of a trading plan announced at the end of last year. When the plan was announced last December the Government's stake in the bank stood at 24.9%.

The Government's stake in the bank now stands at 15.9%, after selling a 1% stake in the lender for around £500 million.

Chancellor George Osborne described the latest sale as "fantastic news".

Mr Osborne added: "I am determined to build on this success, and to continue to return Lloyds to the private sector and reduce our national debt."

Last month, the Government confirmed it would launch a multi-billion pound ''Tell Sid''-style share sale open to retail investors within the next 12 months, following a previous pledge by the Chancellor.

Speculation is that the sale will take place next March after the completion in December of the current trading plan to sell down some of the Treasury's stake to City investors, and following publication of the group's 2015 annual financial results.

Lloyds shares are trading at around 86.4p, well above the 73.6p average price that taxpayers originally paid for them.

A spokesman for the bank 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 four years to transform the group into a simple, low-risk and customer-focused bank that is committed to helping Britain prosper.''

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