The British government will make close to €600 million profit from its bailout of Lloyds Banking Group, Chief Executive Antonio Horta-Osorio said on Thursday.

The government’s stake in Lloyds is down to just 0.25 per cent, Chairman Norman Blackwell said at the lender’s annual meeting in Edinburgh, putting the bank on track to be in private ownership soon.

The estimated €600 million profit is higher than what the bank forecast in March, and contrasts sharply with a similar bailout of Royal Bank of Scotland which is projected to make a loss.

Lloyds shares have fallen by six per cent since the bank’s bailout in October 2008.  The government will make a profit, however, thanks to dividends paid by the bank, the fact that most of the shares were sold for more than the government paid, and a €2.5 billion fee Lloyds paid to avoid entering the Asset Protection Scheme that insured bailed-out banks’ riskiest loans.

UK Financial Investments Limited (UKFI), which manages the government’s stake, resumed Lloyds’ share sales in October, having halted them for almost a year due to market turbulence.

While Lloyds is largely free of the financial damage to its balance sheet sustained during the crisis era, shareholders on Thursday reminded the bank’s management of the reputational damage it still faces.