Taxpayers stand to make a profit of £19 billion if the government's stakes in Lloyds Banking Group and Royal Bank of Scotland are wound down over the next five years, according to an independent consultancy.
The Centre for Economic and Business Research (CEBR) made its prediction as the state's exposure to Lloyds moved into the black for the first time in nine months. Lloyds shares crossed 73.6p - the average purchase price of the government's 41% holding - after the bank revealed bumper first-half results.
Shares in RBS, 81% state-backed, are also trading above the 50p break-even level at 52.1p. RBS is tipped to make a slender profit when it reports on Friday.
The CEBR said better-than-expected profits from the clearing banks - including Northern Rock, in which the taxpayer has an equity interest of around £1.4 billion - pointed to a handsome return for the general public over the medium term.
Chief executive Douglas McWilliams said: "Even on the conservative assumption that share prices will rise with nominal GDP, the government is likely to make a profit if it disposes of the banks in a phased sale over five years of £19 billion."
McWilliams said then-chancellor Alistair Darling succeeded in buying £65.8 billion worth of Lloyds and RBS shares "on the cheap" by refusing to provide the banks with loans.
"Having ripped off the banks' shareholders? the government is now in healthy profit on the shares after fees are taken into account," McWilliams added. He said some of the original shareholders who were displaced by the Treasury at the bottom of the market "may yet take this issue to court".
Although the nationalised banks are returning to health, City minister Mark Hoban has said a sale is unlikely to begin before the end of 2011.