Osborne 'eyes Lloyds shares sale'
Chancellor George Osborne is preparing to use a keynote speech to the City to signal a sale in shares of taxpayer-backed Lloyds Banking Group, it has been reported.
Mr Osborne will use his Mansion House speech on June 19 to reveal the sell-off of the 39% chunk of the bank owned by the state and worth around £17 billion at current prices, according to the Sunday Times.
The sale is likely to take the form of discounted shares to the public, who would be offered the chance to buy stock at a lower price than that available to big investment funds, while there would also be incentives to hold on to the shares for several years. It is not known whether all of the shares would be sold at once.
Mr Osborne is reported to believe that a privatisation could rekindle the enthusiasm of the "Tell Sid" advertising campaign which saw millions buy shares in British Gas in the 1980s.
Lloyds was bailed out by taxpayers at the height of the financial crisis but its shares have now recovered enough to reach a level at which the Government can break even on its investment by selling its stake.
Mr Osborne's announcement will also reportedly indicate plans for the disposal of shares in Royal Bank of Scotland, although this would come after the Lloyds sale - with shares in the 81% state-backed RBS still well below the value at which the Government bought them. The Treasury declined to comment on the report.
But Mr Osborne spoke earlier this year about setting out plans for Lloyds and RBS after the Commission on Banking Standards produces its report. This is due in the next couple of weeks but according to speculation is about to be finalised and could be out in the next few days.
Speaking last month, Mr Osborne said: "Having refocused their business, now is the time for a clear strategy on how to return RBS and Lloyds to the private sector in a way that protects value for the taxpayer.
"The Parliamentary Banking Commission I established is completing its work and we will then set out the way ahead.
"We need functioning banks supporting the real economy, instead of nursing their wounds, and I'm determined we'll deliver it."