£20.3bn to bail out bank recouped

The Government has recouped the £20.3 billion used to bail out Lloyds Banking Group during the financial crisis, leaving the lender on the brink of privatisation.

Lloyds Bank is to close a further 100 branches, with the loss of over 200 jobs, said the Unite union. Picture: PA.

Chancellor Philip Hammond said the Government has now recovered £20.4 billion since it began selling off its stake in the high street bank four years ago.

The taxpayer’s final stake in Lloyds, now less than two per cent, is expected to be sold off in the coming months, with any profits being used to pay down the deficit.

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Speaking in Washington, Mr Hammond said: “Recovering all of the money taxpayers injected into Lloyds marks a significant milestone in our plan to build an economy that works for everyone.

“While it was right to step in with support during the financial crisis, the government should not be in the business of owning banks in the long term.

“The right place for them is in the private sector and I’m pleased to be able to say we are approaching the point at which we will sell our final shares in Lloyds Bank.”

The Government had mulled plans to shed its remaining stake in Lloyds through a retail sale, but former chancellor George Osborne halted it in January 2016, blaming market turbulence.

The idea was eventually ditched altogether by Mr Hammond in favour of a drip-feed sale to institutional investors through a trading plan.

Chief executive Antonio Horta-Osorio said: “As the Government announces it has now received all of the £20.3 billion that was originally put into the group, it is a moment of huge pride for all of us at Lloyds. Colleagues have worked incredibly hard over the last six years to play their part in this journey. As we look to the future, we remain absolutely focused on our commitment to help Britain prosper.”