The British government is said to have made a profit on the privatization of the bailed-out institution Lloyds Banking Group, in a deal valued at nearly $5.2bn, according to National Audit Office (NAO).
The public spending watchdog said that the Government sold a 6% stake in the bank in September this year, through accelerated bookbuilding process to financial institutions, including as pension funds and insurers.
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The United Kingdom Financial Investments (UKFI), which managed the sale for the Treasury, thoroughly reviewed available options for a sale.
Taking account of market conditions and the fact that this was the first of a series of sales, UKFI decided to minimize risk by selling the shares only to institutional investors.
However, considering the cost of borrowing the money to buy the shares, taxpayers are said to have lost at least £230m, the watchdog said.
NAO head Amyas Morse said: "Sale options were reviewed thoroughly and UKFI looks to have got its timing right. The sale took place when the shares were trading close to a 12-month high and at the upper end of estimates for the fair value of the business. Furthermore, the share price in trading after the sale has remained steady."
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