The government has sold a further £500m of Lloyds Banking Group shares through a trading plan launched in December, taking the total amount of money recovered for the taxpayer from the bank to just under £8bn.
The Chancellor said the latest sale meant the government's stake in the bank had reduced to 24%. It follows £7.4bn of sales completed last year, prior to which the government's stake was 40%.
George Osborne added all shares sold through the trading plan had been sold above the average price the previous government paid for them, which was 73.6p.
Osborne said: "I am delighted to announce that the trading plan I launched in December has raised a further £500m for the taxpayer so far. This is further progress in returning Lloyds Banking Group to private ownership, reducing our national debt and getting taxpayers' money back.
"The trading plan and its success are only made possible by our long term economic plan which is delivering a more secure and resilient economy."
The trading plan involves gradually selling shares in the market in a 'measured' way.
Launched on 17 December 2014, it will continue for about four months and will end no later than 30 June.