Government rumoured to be selling off a £5bn stake in Lloyds
Shares in taxpayer-backed Lloyds Banking Group have reached a three-year high amid mounting speculation that the Government is poised to push the button on its stake sale.
Reports suggest the Treasury is considering kicking off the sale process within the week, with plans to offload around £5bn of shares initially -- equivalent to around a quarter of its 39% shareholding.
Lloyds shares were trading at their highest level since September 2010, up another 2% at just over 78p after more than doubling in value over the past year.
This means shares are comfortably above the 61p minimum level at which the state would break even on its bailout, and higher than the 73.6p average price paid at the time of the bank's £20.3bn Government rescue.
Rumours have been circulating for weeks over Treasury plans to place a 10% stake with institutional investors.
The Treasury remained tight-lipped on the sale, but it is thought Chancellor George Osborne could be keen to capitalise on the stock's recent rises, while an announcement might also be timed ahead of the Conservatives' annual party conference starting on September 29 and before Lloyds enters a close period for its third quarter results on October 29.
UK Financial Investments, which manages the Government's stakes in Lloyds and Royal Bank of Scotland, is said to be monitoring the bank's shares on a daily basis, although a final decision rests with Mr Osborne.
Belfast Telegraph Digital