Lloyds Banking Group: Government Shares

Lord Hammond of Runnymede Excerpts

Monday 10th October 2016 Written Statements

[The Chancellor of the Exchequer (Mr Philip Hammond)]

Further to the statement provided to the House on 4 December 2015, today I can inform the House that the trading plan to sell the Government’s shares in Lloyds Banking Group has been re-started. This is a further step in the Government’s plan to return Lloyds to the private sector.

I received advice from UK Financial Investments (UKFI) that selling shares through the trading plan represents good value for money for the taxpayer. This sales method has been very successful previously, achieving over £9 billion of sales between December 2014 and June 2016. In total, we have recovered over £16.9 billion for the taxpayer from Lloyds through sales and dividend payments.

The trading plan commenced on 7 October 2016 and will run for a year. Shares will not be sold below a floor price that HMT has determined delivers value for money for the taxpayer and ensures that the Government will get back all of the £20.3 billion that taxpayers injected into Lloyds during the financial crisis. The actual number of shares sold under the trading plan will depend on market conditions.

I can also announce the withdrawal of the Lloyds retail offer. At the current share price, the retail offer would be extremely unlikely to recoup all the money the taxpayers put into the bank. Our plan will get back all the cash taxpayers invested in Lloyds during the financial crisis and leave the bank in a better place to continue the crucial role it plays in supporting individuals, families and businesses up and down the UK.

I will update Parliament with further details at the end of the trading plan.

[HCWS170]