LLOYDS Banking Group has sold its remaining stake in the St James's Place wealth management business for around £680 million to bolster its balance sheet.

The sale of the 21% holding raised around £10m more than expected and increased the chances that Lloyds Banking Group will be able to declare its first dividend since 2008 in February.

On Monday the bank said it hoped to offload the holding to institutional investors under plans to free up resources and refocus on its core customers, in areas like retail banking.

The group said the placing completed yesterday would allow it to increase its capital by approximately £685m and to realise a £105m gain on diposal.

The 33% state-owned bank placed the 109 million shares it held in St James's Place at 630p per share.

Announcing plans for the stake sale on Monday, the group said it expected the placing to increase its capital by £670m and generate a £95m gain.

The sale follows a series of disposals of assets that chief executive Antonio Horta-Osorio deemed non-core.

It increases the likelihood that directors and regulators will decide the group is in good enough shape to pay a dividend.

In October the bank said it had started talks with regulators over the possibility of making dividend payments. It is expected the group will provide an update in February, when it announces its results for 2013.

No dividend has been paid since the 2008 merger of Lloyds TSB and Halifax Bank of Scotland.

Mr Horta-Osorio has said Lloyds is going to be a high dividend paying stock in the future.