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Lloyds Banking Group is only a few weeks away from being re privatised as the government revealed it has cut its stake in the lender to less than one per cent.

The government announced on Friday morning that its holding in Lloyds has dropped to 0.89 per cent as it continues to drip-feed shares into the market.

The announcement comes only a week after chancellor Philip Hammond announced that taxpayers had received all of their money back after supporting a £20.3bn bail-out during the financial crisis.

The sell-off of Lloyds will mark a watershed moment in the UK banking sector and will draw a line under the financial crisis after the government took a 43 per cent stake in the bank.

Lloyds reported its first quarter earnings yesterday, posting a £1.3bn profit, doubling the previous year’s profit.

In contrast, the government still holds a 72 per cent stake in Royal Bank of Scotland. Mr Hammond warned earlier this month that taxpayers might not get all their money back after injecting £45.5bn into RBS during the financial crisis.

Photo: PA

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