U.K. Reduces Stake in Lloyds -- Update

By Ian Walker 

LONDON--The U.K. government has reduced its stake in Lloyds Banking Group PLC to 23.9%, the lender said Monday.

In a London Stock Exchange shareholding notification Lloyds said that The Commissioners of Her Majesty's Treasury now owns 17.09 billion shares, or 23.9% of the bank's voting rights. It previously held 17.14 billion shares.

No price for the share sale, which was conducted on Friday, was disclosed. Lloyds shares closed Friday at 77.98 pence. The transaction comes just days before the bank reports full-year earnings.

The U.K. government bailed out Lloyds during the financial crisis, taking a 39% stake in the U.K.'s biggest retail bank. So far, the government has raised GBP7.4 billion ($11.4 billion) selling bits of its stake in the lender.

The government said in December it would sell a further chunk of shares in Lloyds by the end of June and mandated Morgan Stanley to gradually sell stock at above the average price U.K. taxpayers paid to bail out the bank.

Previously U.K. Financial Investments Ltd, the body which manages the government's stake in the Lloyds, has sold chunks of Lloyds directly to investors through accelerated placements.

Write to Ian Walker at [e-mail]

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