Royal Bank of Scotland Group Plc raised about 630 million pounds ($1 billion) from its third sale of a stake in Direct Line Insurance Group Plc, the U.K.’s biggest home and car insurer.

RBS sold about 300 million shares at 210 pence apiece to institutional investors, or 20 percent of Direct Line, the Edinburgh-based lender said in a statement today. Direct Line fell 2.2 percent to 213.2 pence by 8:17 a.m. in London. RBS now owns about 28.5 percent of the insurer.

RBS, Britain’s biggest government-owned lender, has to divest the insurer to comply with European Union rules after receiving a 45.5 billion-pound bailout in 2008 and 2009. Direct Line, which sold shares to the public in October, is cutting costs and seeking to sell more profitable policies amid falling premiums in the U.K. and lower returns on investments amid record-low interest rates.

“This successful sale keeps RBS fully on track to meet its obligation to divest its stake in Direct Line by end-2014,” RBS Finance Director Bruce Van Saun said in the statement.

The calculation of the proceeds assumes an over allotment option to sell 27.3 million shares is exercised in full.

Issuers in Europe, the Middle East and Africa have raised about $74 billion in additional share sales this year, compared with about $37 billion in the same period in 2012, according to data compiled by Bloomberg.

The U.K. government sold 4.28 billion shares for 3.2 billion pounds in Lloyds Banking Group Plc this week in the largest accelerated sale of secondary shares since 2009.

Goldman Sachs Group Inc., Morgan Stanley, Royal Bank of Canada and UBS AG are managing the Direct Line sale, which started after the end of trading in London yesterday.

Editors: Jon Menon, Steve Bailey