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87 per cent of Lloyds shares snapped up
Monday 8th June 2009, 1:30PM BST.
Investors have bought 87 per cent of shares offered by Lloyds Banking Group, it has been announced.
The bank said investors had shown “strong support” for the £4 billion rights issue.
The remaining shares are being offered on the open market from today onwards, with profits on these shares above the 38.43p offer price being distributed among shareholders who did not take up the offer.
Any shares not sold in Lloyds, which underwent the rights issue to pay back the government after it took a 43 per cent stake in the bank following its takeover of HBOS, will be bought by Whitehall.
Analysts believe the low price of the share offer helped boost the sales, although the government has claimed the success reflects growing confidence in the banking system.
City Minister Lord Myners told the BBC: “I think we have now moved into a territory in which institutional investors are saying, ‘We now have confidence in UK banks, their capital is strong and they are clearly again lending and supporting the UK economy’.”
Shareholders have expressed their anger with the takeover of HBOS, which has dragged Lloyds into the red.
Chairman Sir Victor Blank is to stand down following the controversy.
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