The bank has 109 million ordinary shares in the life insurer, representing 21% of the business. This holding will be offloaded at 630p, a mere 2% discount to yesterday's market price. St James’s Place was up 1p to 644.5p in response to the news. The transaction is expected to complete on 13 December.
The money will help Lloyds boost its cash-to-assets ratio, further strengthening its balance sheet to meet the incoming Basel III regulation.
News of the sale comes after the 180-day lock-in period expires following the sale of its previous tranche of shares in the business. It sold 15% of the FTSE 250 player for £450 million on 23 May, which followed a £520 million sale two months earlier (15 March).
The deal is part of Lloyds’ strategy to repair its balance sheet after its government bail-out in 2008 and to focus on the UK. It comes a day after it sold some of its property loans for £90 million. Other deals have seen it pull out of some of its international businesses and selling its non-assets, such as its insurance interests.
St James’s Place is a wealth manager that has £41.8 billion of funds under management through its global network.