The UK government has indicated that it is planning to sell its stake in the Lloyds Banking Group and is also considering braking up the Royal Bank of Scotland, according to the Chancellor of the Exchequer.

Chancellor George Osborne has indicated that the government will soon start selling its holding in the Lloyds Banking Group.  It is not know as to how much of the Government's 39 per cent stake in the bank will be sold.  Some suggest that the government might sell 10 per cent stake, which is valued at about £17 billion, in the bank within this year.

Osborne announced in his Mansion House speech on 19 June that the government is considering selling stake in the Lloyds Banking Group.  He did not announce the time frame for the stake sale but said that first block of share will be offered to the institutional investors.  The government is also expected to offer bank shares to the general public at a discounted rate like those offered to institutional investors and incentives for holding on to the shares for a longer term.

On the other hand, the government has an 82 per cent stake in the Royal Bank of Scotland and indicated that the bank might be split into a good bank and a bad bank with troubled assets.