LONDON: Lloyds Banking Group said it would support plans by Britain's Conservative Party to sell some of the government's remaining 22 percent stake in the bank to retail investors.
Finance minister George Osborne said on Sunday that he intended to sell billions of pounds of government-owned shares in Lloyds to small investors if the Conservatives win Britain's national election next month.
"The sale of the stake is clearly a matter for the government. We will support the government in whatever way is required in due course," a Lloyds spokesman said.
The Conservative Party said investors would be able to buy between 250 pounds and 10,000 pounds of Lloyds shares, with priority going to orders of up to 1,000 pounds.
The shares would be sold at a 5 percent discount to market value and investors who hold their shares for a year would receive an extra 10 percent, up to a value of 200 pounds.
Lloyds would need to prepare a prospectus to help to market any sale of shares to retail investors. The bank made preparations for such a sale last year before the government shelved the plans because of a decline in the bank's share price.
Since then, Lloyds has announced its first dividend since a 20 billion pound ($29.9 billion) government rescue during the financial crisis, making the stock easier to market to retail investors.
"There are now more options to sell the shares in different ways," James Leigh-Pemberton, chairman of UK Financial Investments (UKFI), the body that manages the government's stake, said in a letter to Osborne in March this year.
The government has so far sold almost half of the 43 percent stake it was left with following the bailout. To date, the shares have been sold to financial institutions such as pension funds and insurers.
Shares in Lloyds were up 0.6 percent to 79.2 pence at 0815GMT, comfortably above the average 73.6 pence price that the government paid for the shares.
Osborne said in March that Britain would raise at least 9 billion pounds from selling shares in Lloyds over the next year but did not specify what type of investor the shares would be sold to.
Before the financial crisis, Lloyds had a record of being one of the highest dividend paying stocks in Britain, handing over half its profit to shareholders in 2005 and 2006 and analysts say it could eventually pay out that much again.
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