Despite panic amid the huge plunge in global stock markets on Monday, UK Chancellor of the Exchequer George Osborne still plans on selling off the British government’s remaining shares in Lloyds Banking Group “within the year”.
Shares in Lloyds dropped by as much as 4.8 percent to 72.18p on Monday, far less than the 73.6p per share that the government shelled out when it bailed out the failing bank during the financial crisis.
Osborne told Reuters: “My view is that we want the government out of the banking system in the UK,”
Adding: “I hope that will be complete within the year,”
The Chancellor made his comments shortly after the Treasury reduced its stake in the bank to below 13%.
“We have been moving quickly to come out of Lloyds and I hope that the process will be completed in a year,” Osborne told reporters in Helsinki.
“I don’t believe that going on holding these big government stakes is going to do anything good for the taxpayer or banking system — indeed far from it. We need to move out of these banks so they can compete.”
The Treasury began selling off the 43% stake in Lloyds in September 2013. So far, the UK government has recouped 14.5 billion pounds.
Commenting on RBS, Osborne said:
“As to RBS, we hope to make future sales in the coming year. But we will wait — it’s not going to happen in the next day or two.”
Labour MPs call the sale a “rip off”
According to a report by The Financial Times, Labour MP John Mann told the newspaper that the sale of Lloyds was a “rip off” of the UK taxpayer, blaming Osborne for his rushed approach to selling the government’s stake in the bank rather than wait for market conditions to improve.
John Mann told The FT:
“George Osborne is too fixated on selling off in order to have the benefits in advance of the Tory leadership contest, which is increasingly determining his timing,”