The major US investment firm Blackrock has become the biggest shareholder in Lloyds Banking Group, usurping the government which sold down its stake in the bailed-out bank.
Blackrock, which describes itself as the world’s biggest fund manager with $5.1tn (£4.1tn) of investments, now owns the largest stake in Lloyds as the Treasury’s holding has fallen to 5.95%.
The Treasury makes a disclosure to the stock market every time its stake in Lloyds falls by one percentage point and a previous update last month showed its holding had fallen below 7%.
In a fresh stock market announcement on Monday, the Treasury said it had sold a further 700,000 shares.
It did not disclose the price it received but the closing price of Lloyds shares on Friday, the day of the sale, was 65.68p. A sale at that price would have raised £460,000.
The chancellor, Philip Hammond, has sanctioned sales below the average price of 73.6p a share at which taxpayers bought a 43% stake during 2008 and 2009, when Lloyds was rescuing HBOS.
Blackrock does not disclose its precise holding in Lloyds but stock market rules introduced in May 2015 required it to inform investors it had crossed up through the threshold of 5%.
The slump in Lloyds shares forced Hammond to abandon his predecessor’s plan to offer the public cut-price shares in Lloyds, a bank which is focused on the domestic economy. A year ago, George Osborne had postponed the retail offering in the midst of a global stock market rout while Hammond called it off entirely after the vote for Brexit.
The government pumped £20.3bn into Lloyds and, even though it is now selling the shares below the average price paid for them, it has calculated it has received £17.5bn.
Lloyds has been trying to put its crisis-ridden past behind it. It announced last month it would spend £1.9bn buying MBNA, a credit card business, from Bank of America.
The government stake in Royal Bank of Scotland remains at 73% after Osborne sold off 5% in August 2015 at a £1bn loss.