Lloyds got closer to cash dividend: Sells St James's stake

Following its strategy of selling non-core business operations, Lloyds banking group has sold its remaining stake of 21% in St. James Place plc, wealth management firm.  This is in continuation of selling SWIP (Scottish Widows investment partnership) last month and portfolio of Irish home loans to US private equity fund.  The move aims to increase the Tier I capital ratio of company to 10%.

Loyds Banking group was bailed out by British government, which put up 20.5 billion pounds to save it from collapse at time of financial meltdown.  Government currently holds 33% stake in the company.  Company has sold 109 million shares of St.James's Place to financial institutions at 630 pence per share (Gross proceeds was 680 pence per share). As per company it will make a profit of 105 million pounds through this sale and in total capital is boosted by 685 million pounds.  

Lloyds Bank is undergoing re-structural changes from a while.  It is continuously selling its non core business, cutting down costs, selling loans that does not fit in long term strategy of business processes.  As of Q3 Tier I capital for  bank stood at 9.9% and company hopes to increase it by 24 basis points through selling this stake.  Lloyds' aim is to reach 10% by end of this year results.

Related Article: Lloyds to sell Asset Management arm for $1.06 billion