Taxpayer to own 43.4% of Lloyds TSB/HBOS

The taxpayer will own 43.4 per cent of superbank Lloyds TSB and HBOS after few shareholders took up the banks’ share offers.

Just 0.24 per cent of HBOS shareholders took part in the open offer, while 0.5 per cent of Lloyds TSB shareholders bought into the merged bank.

Shareholders were expected to snub the offer of investing in the newly created Lloyds Banking Group, leaving the Treasury to become the biggest investor.

The bank is expected to receive approval from an Edinburgh court later today, and if the deal is cleared, will open its doors on January 19th.

Lloyds TSB chief executive Eric Daniels said: “We are pleased that the capital-raising process has completed and that the new, combined group will have a strong financial position.”

Lloyds Banking Group will be by far the largest bank in the UK, controlling around a quarter of personal bank accounts and approximately 28 per cent of the mortgage market.

The government pledged to underwrite both banks’ offers as part of its £37 billion rescue package for the banking industry.

The taxpayer will also own 60 per cent of the Royal Bank of Scotland, after the bank also offered shares in a bid to raise capital.