The share price of Lloyds Banking Group (LSE: LLOY) (NYSE: LYG.US) is currently up over 1%, after the release of news that it has sold its last remaining Australian businesses to Westpac for Aus$1.55bn (£900m). The deal sees Westpac — Australia’s second largest bank — buying Capital Finance Australia Ltd (CFAL) and BOS International Australia Ltd by the end of the year.
The sale comes towards the end of a five year plan under which Lloyds has divested itself of almost £200bn of non-core assets in what it terms “a capital accretive manner”. Other recent deals include an agreement to sell its German life insurance business Heidelberger Leben for around £257m, and the disposal of a portfolio of leveraged loans to a subsidiary of Goldman Sachs for £254 million. The latest sales have also helped to strengthen Lloyds’ tier 1 capital ratio, as recently required by the Prudential Regulation Authority.
In mid-September the UK government sold a 6% stake in Lloyds, raising £3.2bn and turning a profit of £61m for the treasury, but it still owns almost 33% of the bank. The government has said it intends completely dispose of its shareholding in Lloyds before the next general election in 2015, although the next sale probably won’t be until the new year.
At the time of writing Lloyds’s share price is 75.9p. That’s up almost 60% so far in 2013, and almost 94% on this time last year.
