Chancellor unveils plans to sell remaining stake in Lloyds Banking Group

The Chancellor is to reboot plans to sell the Government's remaining £3.6 billion stake in Lloyds Banking Group, but has abandoned a retail sale.

Philip Hammond said heightened volatility in financial markets would see the Government's 9.1% stake sold through a trading plan to institutional investors.

The move would ensure the Government recoups the entire £20.3 billion used to bail out the bank during the 2008 financial crisis, Mr Hammond said.

Shares in Lloyds, which have plunged 23% since Britain voted to leave the European Union, were down more than 3% after the announcement.

Speaking in Washington during his first trip to the US as Chancellor, Mr Hammond said he had "listened to the experts" and ongoing market volatility means it is not the right time for a retail offer.

"Returning Lloyds to the private sector is in the interests of the bank, taxpayers and the country as a whole," he said.

"That is why exiting our stake in Lloyds in an orderly way, and at the best possible price, is one of my top priorities as Chancellor."

"Our plan will get back all the cash taxpayers invested in Lloyds during the financial crisis and leave the bank in a better place to continue the crucial role it plays in supporting individuals, families and businesses up and down the UK," he added.