Lloyds Share Sale To Take Place By Next March

The Treasury is "determined" to resurrect the delayed sale of shares in Lloyds Banking Group (Other OTC: LLOBF - news) to members of the public by the end of next March, a minister has said.

Lloyds, which also includes Halifax and Bank of Scotland, remains 9% owned by the taxpayer after its £20bn rescue during the financial crisis.

The Government has been whittling down its stake from 43% through a gradual sale to City institutions,

But a hotly-anticipated £2bn stock offer open to retail investors was put on ice by Chancellor George Osborne in January amid market turbulence.

Now Harriett Baldwin, Economic Secretary to the Treasury, has said the Government is committed to a sale in 2016/17, the fiscal year to the end of March.

Initial plans for a public offer had been put on hold by the Chancellor after global stocks were hit by worries over a world economic slowdown and a slump in oil and other commodity prices.

The Government will only sell when it can break even on the money ploughed in at the time of its bail-out of the bank, when shares were priced at 73.6p. They closed at just over 67p on Tuesday.

Since Lloyds' bail-out, the Treasury has recovered £16.8bn of its outlay. The latest tranche came when a dividend payment of £130m was announced on Tuesday.

Ms Baldwin said it marked "another milestone in Government's plan to recover the money taxpayers were forced to put into Lloyds during the financial crisis".

She (Munich: SOQ.MU - news) added: "I am determined to build on this success by making Lloyds shares available to the public this year, so that we can build a share-owning democracy and continue to reduce our national debt.

"The Government is committed to launching a retail sale of Lloyds Banking Group shares and to fully returning its stake to the private sector in 2016 to 17."

Laith Khalaf, senior analyst at Hargreaves Lansdown (LSE: HL.L - news) stockbrokers, said the latest dividend reduced the Government's break-even price on future sales by 2p to 70.5p.