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The UK government is no longer the biggest stakeholder in Lloyds Banking Group, after it cut its stake to less than 6%.

The government spent £20.3bn to acquire a 43% stake in Lloyds at the height of the financial crisis.

It has already said it wants to return the bank to full private ownership during the course of 2017.

The biggest shareholder in Lloyds is now Blackrock, the world's largest asset manager.

Royal Bank of Scotland (RBS) is still about 71%-owned by the government. In the aftermath of the 2008-2009 banking crisis the UK government had to spend a total of £115bn to rescue Lloyds Banking Group and RBS from imminent collapse.

UK Financial Investments, which manages the government's stake, stopped selling Lloyds' shares last January because of financial market volatility.

In October, it resumed sales to institutional investors, but because of continued volatility, the shares were not made available to member of the public.

Analysis: Simon Jack, business editor

As a plain vanilla UK savings and lending bank, Lloyds was always going to be an easier bank to fix than RBS which is still about 71% owned by the taxpayer.

As a global bank with fingers in most of the pies that got burnt during the crisis, RBS has paid out over £50bn pounds in fines and compensation and has its biggest reckoning yet to come.

It is still facing a bill from US authorities which could end up in the double digit billions for its role in the subprime mis-selling scandal that started the whole financial crisis in the first place.

While those negotiations could come to a head as early as this week (watch out for separate blog on this), RBS won't reach the point Lloyds did today for many, many years to come. Read more from Simon here

"Returning Lloyds to the private sector and recovering all of the cash the taxpayer injected into the bank during the financial crisis is a priority for the government," said Chancellor of the Exchequer, Philip Hammond.

"Confirmation that we are no longer the largest shareholder in the bank and that we've now recouped over £18bn for UK taxpayers is further evidence that we are on track to recover all of the £20bn injected into the bank during the financial crisis."

Nicholas Hyett, equity analyst at Hargreaves Lansdown, said: "Retail investors had the disappointment of being denied involvement in a Lloyds share sale, although there is still time and plenty of opportunity to rectify this with the remaining circa £2bn stake."