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* St James's Place stock up nearly 27 pct this year
* Lloyds to sell at least 102 mln shares
By Kylie MacLellan
LONDON, March 11 (Reuters) - UK lender Lloyds plansto sell 20 percent of wealth manager St James's Place tofocus on core banking and respond to regulatory pressure tostrengthen its capital.
The placing of at least 102 million shares would be worthjust under 550 million pounds ($820 million) at St James's Place closing share price on Monday of 536.5 pence.
Such block sales of shares are usually sold at a discount.
Lloyds said it expected the placing to increase the group'score equity by 500 million pounds and its core capital ratio byabout 15 basis points, under the full impact of global capitalrules currently being implemented.
"The placing reflects Lloyds's strategy to simplify thegroup and focus on its core customer franchise," it said in astatement.
The bank, which is 39 percent state-owned, acquired thestake as a result of its rescue of HBOS during the financialcrisis and has long been rumoured to be considering selling it.
Speculation over a possible disposal was in the past seen byanalysts as holding back share performance, leading the wealthmanager to say in 2010 that any plans by Lloyds to offload thestake had been shelved for the time being.
Shares in St James's Place are up 26.8 percent since thestart of the year.
Last month St James's Place, which sells a broad range offinancial products including a suite of mutual funds hand-pickedfrom across the industry, raised its dividend by a third andsaid it planned a similar increase in the coming year.
It has defied the financial crisis with consistent flows ofnew funds from clients who want to protect nest eggs from theravages of low interest rates as they near retirement.
Lloyds said that following the placing, expected to becompleted either later on Monday or on Tuesday morning, it would hold around 37 percent of St James's Place and had agreed notto reduce its stake further for at least a year.
The sale is being run by Bank of America Merrill Lynch.
