Lloyds sees share price reach government break-even point

Lloyds Banking Group's shares advanced Friday to a level which the government considers high enough to exceed the break-even point for a sale of its stake in the company.

Lloyds Banking Group's shares advanced Friday to a level which the government considers high enough to exceed the break-even point for a sale of its stake in the company.

The state-backed lender rose 3.02% to 62.75p at 13:57, above the government's 61.2p break-even price.

Industry sources and analysts have said the government wants to start selling when the shares are trading consistently above 61.2p. The state is yet to set a date for a sale.

Mike van Dulken, head of research at Accendo Markets, told Reuters the government has a predicament over whether to sell while the iron is hot or delay in order to allow the shares to maintain their current momentum.

"It's a big trade-off between returning the shares to the markets as quickly as possible (well before the 2015 election anyway), and taking the opportunity to make up for some of the costs taxpayers incurred via forced bailouts," he said.

It is understood the government would want the shares to be firmly established at a level comfortably over break-even before it begins to undo its stake, a source told the news agency.

Britain's finance ministry declined to comment.

RD

Recommended

Broker safety – your questions answered
Investment strategy

Broker safety – your questions answered

Cris Sholto Heaton answers more of your questions about the safety of stockbroker accounts
25 Mar 2020
How demographics affects stock valuations
Investment strategy

How demographics affects stock valuations

New research suggests that stock and bond valuations are driven by the age of the population – at least in the US.
24 Feb 2020
Do you own shares in Sirius Minerals? Here’s what you need to do now
Stocks and shares

Do you own shares in Sirius Minerals? Here’s what you need to do now

Mining giant Anglo American has proposed a cash takeover of Yorkshire-based minnow Sirius Minerals. Unhappy shareholders must decide whether to accept…
20 Feb 2020

Most Popular

Why we won’t see a house-price crash in 2021
House prices

Why we won’t see a house-price crash in 2021

Lockdown sent house prices berserk as cooped up home-workers fled for bigger properties in the country. And while they won’t rise quite as much this y…
18 Jan 2021
Inflation is the easiest way out of this – just don’t expect politicians to admit it
Inflation

Inflation is the easiest way out of this – just don’t expect politicians to admit it

The UK government borrowed £34.1bn in December, a record amount for that month. Britain's debt pile now amounts to 100% of GDP. How are we going to pa…
22 Jan 2021
The best investment trusts to buy for 2021
Investment trusts

The best investment trusts to buy for 2021

Sectors ranging from emerging markets to student accommodation look poised to do well this year, says David Stevenson, as he picks the best investment…
19 Jan 2021