Lloyds Shares - will quantity increase again?

Tea3

Sorry if this has been asked before - had a look but although lots on lloyds shares I could not see this question.

My husband was given 100 lloyds tsb shares years ago and instead of taking the cash rewards he opted to have the profit used each quarter to buy more shares instead. He received a statement yesterday saying he now only has 68 shares whereas before he had near 3000. It mentioned something about he now gets only 1 share for every 40 he previously had (am not savvy on shares etc but am assuming this is due to the 40% stake the government have in the bank now - sorry if i'm stating the obvious). My question is will the bank re-pay this money to the government eventually and will the shares therefore go back more-or-less to what they were (quantity wise, not price per share value wise)? Or is he now stuck for good with much less shares worth thousands less than before?

If any of this is real obvious stuff i'm sorry but stocks/shares is not my area of expertise by a long shot.

agsnu

I'm not really sure that you mean here... If he had 3000 shares before, he should have 3000 shares now. All that has happened is that Lloyds has issued more shares (meaning each share is worth less of the company).

Actually, it looks like the 1 for 40 issue is related to the capitalisation issue (see here: they're giving you an EXTRA 1 share for every 40. So you'll have an extra 68 shares or whatever, on top of the 3000 that you already own.

sabretoothtigger

If he had hbos shares then he would have less lloyds shares now


If he held actual lloyds shares not options then he'll hold the same number.
The government owns newly created lloyds shares, same cake now with 3 times as many pieces and to me that means a reduction in worth of each share though they got money for them so the company should be more secure/highly valued



Have a look at all the special kind of shares your husband might have actually got, through his job? Above, I was referring to ordinary or voting shares

http://www.investopedia.com/search/searchresults.aspx?q=shares&submit=Search



Now I think about it, your talking about the scrip dividend I believe. They gave out some free shares, 1 for every 40 you hold. This is your dividend, keep them or sell them if you like but your original holding is just the same in value, etc


1/40 is 2.5% and this is your 'interest' for being an owner of lloyds bank


3000/40 is 75 which sounds close to your 68 new share statement

Tea3

Thats what we thought but he received a sheet from them saying he now has 68 shares (1 share issued for every 40 shares that he had). Apparnently they are issued pursuant to the Capitalisation Issue - no idea what that means but he has a new certificate sheet showing only these 68 shares. Was only going on what hubby was saying before but I am now wondering if these are extra shares given to him on-top of (and not instead of) his original shares - no idea why he got them if this is the case, but am pleased if they are on-top of his existing ones (they may not be worth a huge amount but better than losing them lol).

ADDED:
Sorry - posts crossed over -thanks for the quick replies and good to hear they are extra on-top of and not instead of his original shares (phew). Told you shares were not my thing lol

agsnu

It's because the terms of their government support means that they can't pay a dividend until the taxpayer is paid back, they are issueing shareholders with new shares instead.

sabretoothtigger

Yes you will get even more confusing documents soon, again it'll be new shares.
Generally its a good thing, they just became the biggest bank in the uk in the middle of a once in a century storm so some war time advice seems relevant

frugalmacdugal

Hi,

I have some LLoyds shares and got 2 new certificates on Saturday, one for my original LLoyds holding and one for the allocation I got when HBoS was taken over, I intend to write to the registrars and amalgamate these soon.

OP, as regards your husbands nearly 3000, he still has those, and the extra 68 are LLoyds way of getting round not being able to pay a dividend, as they have to pay back the goverment first.