UK-listed Lloyds Banking Group, which is looking to repay government bailout cash, said yesterday its rights issue was 95 per cent subscribed.

As part of its capital-raising move, the bank accepted bids for 34.79 billion new shares, which will be dispatched to shareholders by no later that 29 December 2009, the firm said in a statement.

Lloyds, like rival UK bank Royal Bank of Scotland, has received billions of pounds in UK state aid due to heavy losses connected to the financial turmoil. As a result of European Union rules governing state aid to private firms, Lloyds is embarking on a programme to spin off some of its businesses and slim down its operations.

The new shares began trading yesterday on at London Stock Exchange, Lloyds said.

BofA Merrill Lynch, UBS and Citigroup Global Markets UK Equity, which are global co-ordinators of the rights issue, said they will work to attract subscribers for those shares not yet taken up.

In November, Lloyds announced it will make a total of about 5,000 job cuts, but these reductions will not affect the UK bank’s private banking operations, the firm has told this publication.