The prospect of a 'Tell Sid' popular privatisation of the rump of Lloyds Banking Group has come closer with the extension of the government's plan to sell off its shares in the bank.
UKFI , the holding company for the taxpayers' stakes in Lloyds and RBS, has now given advisers Morgan Stanley "full discretion to continue to effect a measured and orderly sell down of the shares in the company" on behalf of the Treasury.
Two weeks before the election, David Cameron promised to order the sale of billions of pounds of Lloyds shares to the public within a year, at a discount of at least five per cent. It would be backed by a publicity drive similar to the "Tell Sid" British Gas campaign in 1986 which created millions of new shareholders in the UK's first privatisations. The retail offering is expected to account for up to a third of the government's outstanding stake, currently valued at around £12bn, and to be launched early next year.
Chancellor George Osborne has said that a Royal Mail-style cap of £1000 may operate on share bids to enable as many people as possible to participate. Industry sources say a possible window of opportunity for the sale would be next March, after Lloyds publishes its 2015 results.
UKFI said the Lloyds stake, which began in 2008 at 41per cent, had been reduced to under 19per cent and the trading plan had now been extended to December 31.
The government still holds 13.6bn shares, which were up 1.1 per cent at 88.7p, and has so far recouped just over half of its £20bn bail-out
cost.
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