Another chunk of its stake in Lloyds Bank (LON:LLOY) was sold by the Government this morning as it gets set to offer shares to the public.
The 1% sell-off by the Treasury takes its stake in Lloyds to under 11%, with about 3.6% of the remainder earmarked for the sale to retail investors.
Yesterday, leading wealth manager Hargreaves Lansdown said it alone had registered 120,000 potential investors.
People applying for investments of less than £1,000 in Lloyds will be prioritised, the Treasury said.
There will be a bonus share for every 10 shares for those who hold their investment for more than a year, capped at £200 per investor.
The finance ministry plans to launch the sale of at least £2bn of shares to retail investors at a 5% discount to the market price.
Elsewhere, the government also moved forward its plan to sell off its stake in taxpayer-owned Royal Bank of Scotland (LON:RBS).
Part of its stake has been converted from non-voting shares into ordinary shares to make them easier to sell.
It follows the sale of the first chunk of shares in August at a loss as it pushes to dispose of its stakes in banks rescued during the 2008 financial crunch.
The Treasury had needed the non-voting shares to maintain RBS’s stock market listing, but the recent sale removed this issue.
The government still owns 72.9% of the bank, having sold £2.1bn worth of shares in August at 330p crystallising a £1.1bn loss for the Government.
UK Financial Investments, the agency which owns the Lloyds and RBS shares, has so far recouped £15bn of the £20bn that bailed-out Lloyds amid the height of the financial crisis.
Since then its shareholding has fallen from to 10.97% from 43%.
The Treasury said it would use the cash from the Lloyds sale to pay off part of the national debt.
It aims to have sold all the shares, leaving Lloyds ‘fully privatised’ during 2016.
The last public sale of a nationalised asset was postal service Royal Mail (LON:RMG), where a subsequent surge in the share price led to criticism it had been sold on the cheap.
Shares in Lloyds were 1.5% higher at 77p while RBS climbed 1.4% to 335p.