Just three days after the U.K. Treasury unloaded some of its stake to the public, a botched press briefing from a Financial Conduct Authority official caused an implosion in life insurance shares that hit Lloyds' (LYG) stock price by as much as 3%. Treasury Chancellor George Osborne issued an extraordinary reprimand to the FCA calling the insurance review "damaging both to the FCA as an institution and to the U.K.’s reputation for regulatory stability and competence."
“This will make it harder to sell another tranche of shares,” says a person close to Lloyds. “It hasn’t made UKFI’s life any easier - investors are asking if the government is an honest seller.”
Much ado about nothing, says one of the bookrunners. “It didn’t affect the market for more than a couple of hours - for god’s sake, talk about short-termism.”