The UK government has now recovered all of the money it used to bail out Lloyds Banking Group at the height of the financial crisis.
Philip Hammond announced that the Treasury has now received £20.4bn since it began selling shares of the bank to investors in 2013.
The company is on the brink of complete privatization, with taxpayers now owning less than 2% of the company, down from a 43.4% stake following the UK bank rescue package.
The final stake in the bank is expected to sold off in the coming months. Profits from these shares will be used to pay down the deficit.
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.”
Lloyds Banking Group 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.”
Laith Khalaf, senior analyst at stockbrokers Hargreaves Lansdown, was quoted by Sky News as saying:
“For the Treasury, the elephant in the room is of course RBS, which required twice as much financial support from the taxpayer as Lloyds.
“The RBS share price needs to double from its current level before the taxpayer breaks even on the bailout, and that isn’t happening anytime soon.”
