Lloyds has publicly thrown its weight behind the Conservative Party's plans to sell billions of pounds worth of shares in the bank at a discount to private retail investors, if the Tories are returned to power.

Under the terms of the offer buyers will receive a discount of at least 5% on the market price at the time of the sale and priority will be given to investors purchasing up to £1,000 worth of shares.

A Reuters report quoted a Lloyds spokesman as saying that "the sale of the stake is clearly a matter for the government. We will support the government in whatever way is required in due course".

Shares in Lloyds were trading 0.72% higher at 8.30am in London.

Discount for small investors

Writing in Sunday's Telegraph, Osborne said the initiative will give "many more people a stake in our economy," while ensuring the £20bn (€27.7bn, $30bn) Labour spent to bail out the bank following the financial crash of 2008 is repaid.

The minimum purchase will be £250 and there will be a maximum limit of £10,000.

Buyers will be rewarded with a loyalty bonus if they keep their shares for a year.

Critics of the plan have made the point that banks present a complex investment proposition and are relatively risky compared to traditional large scale "kitchen table" equity offerings like British Telecom.

The government has so far sold almost half of the 43% stake it was left with following the bailout but only to institutional investors.