George Osborne wants Lloyds sell-off by 2015


Chancellor George Osborne will use his Mansion House speech this week to signal he is keen for Lloyds Banking Group to return to private ownership by the 2015 general election.

The Financial Times reports that according to aides, Osborne will not lay out a specific timetable for a sell-off of the Government’s stakes in either Lloyds or Royal Bank of Scotland when he gives his Mansion House speech on Wednesday. The Treasury is said to be cautious about setting a rigid timelime for a share sale or the price at which a sale would be triggered.

Lloyds shares are currently trading at 61.7p, above the 61p average price at which the Government’s stake is booked in the accounts. But the FT says the price would need to climb 20 per cent to 73.6p in order to recoup the Government’s £20bn capital injection into the bank.

In an interview with the Sunday Telegraph, outgoing Royal Bank of Scotland chief executive Stephen Hester said it could take up to a decade to re-privatise RBS and recoup the Government’s £45bn stake in the bank.

The Parliamentary Commission on Banking Standards is set to produce its long-awaited final report this week on banking reform, which is expected to criticise the Government for failing to have a clear strategy to return Lloyds and RBS to full health. Osborne will use his Mansion House speech to respond to the report.