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Lloyds to reduce stake in St James’s Place

Move to improve Lloyd’s capital position and maximise value for shareholders.

Lloyds Banking Group has decided to sell at least a third of its 57 per cent stake in St James’s Place Wealth Management to raise more than £500m, retaining around 37 per cent of the company.

As well as reducing the size of its balance sheet, the disposal reflects Lloyds’ strategy to focus on its core UK retail and commercial banking operations.

The cash raised could also ease any existing regulatory concerns about Lloyds' capital position and will also help the financial group to resume dividends payment.

Lloyds expects to book a gain of between £350m and £400m by reducing the size of its stake in St James’s Place. This should improve Lloyds’ core tier-one capital by about £600m, improving the ratio to the bank’s risk-weighted assets by 0.2 percentage points to 12.2 per cent, according to the Financial Times.

Furthermore, the brand value of the St James’s Place will also help Lloyds to book gains on intangible assets.

David Bellamy, CEO of St James’s Place, said: “Increased liquidity in our shares and a broader shareholder base is beneficial to our business and our shareholders.”

St James’s Place was established by Sir Mark Weinberg, Lord Jacob Rothschild and Mike Wilson in 1991.

Meanwhile, shares of St James’s Place closed at record prices.