The stake was acquired after Lloyds' failed bid for Standard in 1986 and is the second biggest shareholding in the bank after the near 15 per cent held by Tan Sri Khoo Teck Puat, the Malaysian businessman.
Tan Sri Khoo has been a steady buyer of Standard shares in the years since the takeover attempt but reached the ceiling above which Bank of England permission is required to buy more.
Standard's share price has fallen back from its high of more than pounds 13 as bank shares in general have come off the top and worries have emerged about a hiccup in its Far Eastern base of Hong Kong.
Lloyds has been expected to realise the stake since it announced its bid for Cheltenham & Gloucester Building Society last month. It has no urgent need for the cash, since the earliest the bid can go through is spring next year, but City institutions are believed to have been sounded out in preparation.Reuse content