TSB returns to stock market with a sweetener for ordinary retail investors

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TSB will return to the stock market for the first time in nearly two decades next month after taxpayer-backed owner Lloyds Banking Group announced its long-awaited flotation.

The offer comes with a sweetener for ordinary retail investors with the pledge that they will receive one free share for every 20 they hold on to for a year - up to the value of £2,000.

Lloyds is selling about a quarter of the business, with up to a fifth of this chunk expected to be sold to retail investors and the rest likely to be snapped up by City institutions. A prospectus for the sale will be published in mid-June.

Georgina Mitchell, head of investment services at Leeds-based Redmayne-Bentley, said yesterday: “With only a handfull of initial public offerings open to retail investors over the last 12 months, today’s announcement represents a great opportunity to purchase shares in a well-known, high street bank. “IPOs are very much the talk of the stock market at the moment.”

TSB, famous for its 1980s slogan “the bank that likes to say yes”, traces its history back more than 200 years.

It was floated in 1986 and merged with Lloyds in 1995. A taxpayer rescue of the group during the financial crisis - following which the Treasury still owns a 25 per cent stake in Lloyds - meant that it was obliged to spin off hundreds of branches under EU rules on state aid.

Hunter Kelly, EYs head of restructuring for Yorkshire and the North East

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