Latest news with #LloydsBankingGroup
Daily Mail
a day ago
- Business
- Daily Mail
Blow to City as pension provider Scottish Widows prepares to cut its exposure to UK equities
Pension provider Scottish Widows is preparing to cut its exposure to UK equities in a fresh blow to the City. The company, which is owned by Lloyds Banking Group, manages £72billion of workplace pension assets in its default funds. It is reducing the allocation to London-listed shares in its highest-growth portfolio from 12 per cent to 3 per cent, according to a document seen by the Financial Times. The move comes as ministers and City grandees battle to encourage pension schemes to invest more in British assets to reverse an exodus of companies from the London stock market. A major shift in retirement fund portfolios from British stocks is seen as a key factor in holding back valuations of UK-listed companies. Many have left for Wall Street – with fintech firm Wise the most recent example – or are being snapped by bargain-hunting overseas predators, as in the case of Alphawave, which is being acquired by America's Qualcomm. And a dearth of flotations means departing companies are not being replaced. The Government has responded by persuading 17 pension providers to pledge to invest at least 5 per cent of their default funds in UK private market assets. However, Scottish Widows did not, and it has now told clients it would adopt a 'more globally-diversified approach' with the ambition of 'capturing more growth opportunities in high-performing international markets', the FT reported. US markets have delivered much better returns over the past decade than the FTSE 100, making it more attractive to investors on this side of the pond – though, more recently, the uncertainty created by Donald Trump's erratic policy-making has sowed doubts. Sources close to Scottish Widows, which has total assets under administration of £230billion, say it is already heavily weighted to the UK. Of the £165billion in 'discretionary' funds run for clients, more than a fifth is invested in the UK. And out of £72billion default pension investments, £5.5billion is in London-listed equities. The switch from UK equities relates to a sub-fund that it is being moved to a 'baseline' allocation to global equities already widely used by other providers. It is expected to be completed by December or January. Scottish Widows said it would review the allocations annually and 'where appropriate may include a home bias'.
Yahoo
2 days ago
- Business
- Yahoo
Natwest top pick to acquire TSB
British banking juggernaut Natwest Group has been pegged as the 'most likely acquirer' of TSB Bank. Natwest returned to private ownership last month, ending a nearly two-decade-long banking saga and setting the lender up for a deals spree. The bank has purchased over £5bn worth of shares from the Treasury as part of its directed buyback program in the last four years, which now frees up bundles of capital for the lender. 'We think that this transaction makes the most sense for Natwest,' RBC analysts Pablo de la Torre Cuevas and Benjamin Toms said. 'Management has been the most open around potential merger and acquisition.' Analysts said a sales transaction could reach £2.6bn, which would 'not require Natwest to raise capital'. Cuevas and Toms said the takeover would help Natwest 'participate in UK consolidation, whilst increasing its market share in mortgages, where the bank is currently under weight.' TSB Bank's owners, Banco Sabadell, confirmed they had received expressions of interest over a potential takeover of their UK unit on Monday. Sabadell said it 'will assess any potential binding offer it may receive'. TSB was previously owned by Lloyds Banking Group and was acquired by Sabadell in 2015 for £1.7bn. Lloyds could be out of the running for a takeover due to 'market share concerns'. The Competition and Markets Authority (CMA) assesses merger and acquisition deals to ensure they don't substantially lessen competition. Lloyds, as the largest retail bank in the UK, may face scrutiny that a takeover could make it too dominant. But analysts noted the government's ousting of Marcus Bokkerink, former head of the CMA, could 'help facilitate UK deals, meaning that even Lloyds could kick the tyres on TSB.' Analysts said Natwest could afford the takeover through a £1.1bn reduction to buybacks and a marginal hit to its CET1 ratio, which indicates how well-capitalised and more likely to withstand financial stress. Natwest booked £1.8bn in pre-tax profit for the first quarter of the year, surpassing the £1.6bn pencilled in by analysts. A potential takeover would follow an £11bn bid by the group for Santander UK's retail arm earlier this year, according to reports from the Financial Times. Talks between the two lenders are no longer active, but should the takeover have gone ahead, it would have birthed the biggest banking deal since the financial crisis. The bank kicked off its shopping spree last year after snapping up the majority of Sainsbury's banking assets and purchasing Metro Bank's £2.5bn residential mortgages portfolio. Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
The Sun
2 days ago
- Business
- The Sun
Lloyds, Halifax and Bank of Scotland to make BIG change to account fees in boost for millions – are you affected?
LLOYDS, Halifax and Bank of Scotland are making a big change to account fees in a matter of days. Millions of Lloyds Banking Group customers will see their overdraft costs fall, The Sun can reveal. 1 An overdraft allows you to borrow money through your bank account when your balance drops below zero, up to an agreed limit. Lloyds, Halifax, and Bank of Scotland are now reducing overdraft rates for millions of new and existing customers. For new customers, all overdrafts will come with a 29.9% representative rate. At the same time, millions of existing customers currently paying 39.9% or 49.9% on their overdrafts will have their rates reduced to 29.9%. This comes just months after the banking giant, which also owns Halifax and Bank of Scotland, revamped its overdraft interest rates. In January, Lloyds introduced four overdraft tiers - 19.9%, 29.9%, 39.9% and 49.9%. Customers were given a rate based on their credit history - those with good credit got lower rates, while those with poor credit got higher ones. As a rule, new customers signing up for a Lloyds Bank overdraft used to be offered a 39.9% representative rate. These new rate changes, which will be coming in over the next few days, could save borrowers hundreds of pounds in interest each year. For example, if your interest rate dropped from 49.9% to 29.9%, the cost of borrowing £1,000 over 12 months would fall by £299. CARD REFUNDS: Section 75 versus Chargeback Meanwhile, if your interest rate falls from 39.9% to 29.9%, the cost of borrowing the same amount over 12 months would fall by £100. A Lloyds Bank spokesperson told The Sun: "We know many customers find it helpful to have an overdraft there for life's unexpected costs and, to make that as affordable for our customers as possible, we're lowering the interest rate most customers typically pay when they use an overdraft. "This means the cost of using an overdraft will become cheaper for many, with Lloyds, Halifax and Bank of Scotland now offering one of the lowest representative overdraft rates on the market." Lloyds said it will contact affected customers in the coming days to explain the changes. Customers whose interest rates are decreasing will receive seven days' notice. Think before you borrow BORROWING sounds like a simple way to help pay bills – but beware falling into debt you cannot pay back. It's always vital to ask yourself if you actually need to borrow before committing to a new credit card, personal loan or overdraft. If you cannot afford to pay off debt you already have, you should avoid at all costs taking on any more. What are the alternatives to overdrafts? Depending on individual circumstances, some borrowers may find it more cost-effective to use alternatives to an overdraft, such as a credit card with a 0% interest period. These cards, called balance transfer cards, let you move existing debts to the new card and avoid paying interest on them for a certain period. The leading card on the market right now is from NatWest, which offers an impressive 34-month 0% balance transfer deal, though it comes with a 3.49% transfer fee. However, applicants should note that this deal isn't guaranteed for everyone. Tesco Bank is close behind with a 33-month 0% interest offer and a slightly lower transfer fee of 3.19%. Some people may also have savings they could turn to, rather than help clear their debts. Ideally, you will have built up an emergency fund which you can dip into — but sometimes that just isn't possible. Before you borrow cash, do your research to find out the cheapest option for you. And remember to speak to your bank as lenders must help if you're in financial difficulty. If you're looking for a more affordable way to borrow, a loan from a credit union is worth considering. Credit unions are a much cheaper alternative to payday loans, and some can even provide funds on the same day. Their interest rates are significantly lower than those of credit cards or overdrafts, ranging from 12.7% APR (1% per month) to a maximum capped rate of 42.6% APR (3.5% per month). How to get free debt help There are several groups which can help you with your problem debts for free. Citizens Advice - 0800 144 8848 (England) / 0800 702 2020 (Wales) StepChange - 0800138 1111 National Debtline - 0808 808 4000 Debt Advice Foundation - 0800 043 4050 You can also find information about Debt Management Plans (DMP) and Individual Voluntary Agreements (IVA) by visiting or Speak to one of these organisations - don't be tempted to use a claims management firm. They say they can write off lots of your debt in return for a large upfront fee. But there are other options where you don't need to pay.
The Guardian
4 days ago
- Business
- The Guardian
UK bank TSB could be sold off by Spanish owner Sabadell
The Spanish bank Sabadell has said it has received interest from prospective buyers of its UK division TSB, and said it would assess any firm offers it may receive. Sabadell wants to sell TSB as it battles to fend off an €11bn (£9.4bn) hostile approach from its Spanish rival BBVA. The Catalonia-based lender said it had received 'preliminary non-binding expressions of interest' for TSB from unnamed bidders, and would examine any potential binding offer. TSB has more than 5 million customers, and made headlines during a large-scale IT meltdown in 2018. Sabadell acquired TSB, which was previously owned by Lloyds Banking Group, for £1.7bn a decade ago. At the time, the bank wanted to 'internationalise' and expand outside Spain. However, the lender, which was created in 1881 by 127 families in Catalonia with the aim of financing local industry, has been locked in a prolonged takeover battle with BBVA for more than a year, casting uncertainty over TSB's future. Spain's socialist-led government, which has been opposed to a combination of the two big banks, last month carried out a full review. Together, BBVA and Sabadell would be the second-biggest player in the loan market, ahead of Santander but behind CaixaBank. The European Commission said last year it did not have any objections to the takeover of Sabadell after completing a foreign subsidies review. In November, TSB appointed Marc Armengol as chief executive, and he took over at the start of this year. He is a former strategy director at TSB who has served on the board since 2022, and originally joined Sabadell in 2002. Sign up to Business Today Get set for the working day – we'll point you to all the business news and analysis you need every morning after newsletter promotion A sale of TSB could generate between £1.7bn and £2bn, a source told the Financial Times. Also on Tuesday, the Irish government said it had sold its remaining shareholding in AIB Group, one of the country's two biggest lenders. It was nationalised 15 years ago as part of the eurozone's biggest state rescue during the financial crisis. The government sold a 2.06% stake in AIB at €6.94 a share, which will generate €305m, the finance ministry said. This will take the total returned to the state from its investment to €9.8bn.
Yahoo
4 days ago
- Business
- Yahoo
TSB put up for sale as Spanish owner retreats from Britain
TSB has been put up for sale as its Spanish owner looks to retreat from the British banking market after a decade. Sabadell is exploring selling off its British subsidiary after receiving interest from potential bidders. The Spanish bank has begun circulating documents to interest parties and granted limited access to one of its data rooms to allow potential buyers to carry out due diligence, the Financial Times reported. Last night Sabadell confirmed it has received approaches about TSB and said it would 'assess any potential binding offers'. The potential sale comes a decade after Sabadell acquired TSB from Lloyds Banking Group in 2015. Sabadell initially bought the lender to gain a foothold in the UK as it struggled to grow in Spain, where the economy was still reeling from the impact of the 2008 financial crash. However, Spain is now one of Europe's fastest growing economies, expanding by 3.2pc in 2024 compared to 1.1pc in the UK. Sabadell is also involved in its own hostile takeover saga that has prompted questions about TSB's future. A TSB takeover would add to a wave of dealmaking within the British banking sector. Metro Bank saw its share price surge 15pc on Monday following reports it had received an offer from private equity firm Pollen Street Capital. Coventry Building Society in January completed its £780m acquisition of Co-op Bank, while Nationwide last year separately completed a takeover of Virgin Money for £2.9bn. Santander, meanwhile, last month rejected an £11bn offer from NatWest for the Spanish lender's UK retail banking business. Speculation that Santander could be preparing to exit the UK market has prompted a public denial from the lender. Johann Scholtz, an analyst at MorningStar, said the widespread takeover interest reflected higher levels of profitability at Europe's biggest banks after a surge in interest rates since the pandemic. He said: 'European banks' valuations have increased so banking management teams are seeing less value in buying back their own shares and are looking for other avenues to deploy excess capital. 'The whole M&A space in European banking is heating up with buyers now looking for obvious targets.' TSB made a pre-tax profit of £290.4m last year, marking a 22.4pc increase on the year before. The British bank paid its Spanish owner a record £300m dividend on the back of the strong results. The lender, which traces its origins back to the formation of the Trustee Savings Bank in Dumfriesshire in 1810, currently has five million customers across the UK and a mortgage book worth over £33bn. Potential buyers include Barclays, NatWest, Santander and HSBC, all of which could use an acquisition to strengthen their own positions in the UK market. Lloyds is unlikely to bid given it was made to sell-off TSB under the terms of a financial crisis rescue deal. A sale by Sabadell comes as Spain's fourth largest bank fights an €12bn hostile takeover bid from its Bilbao-based rival BBVA. The saga had led to questions about the future of TSB, which would look increasingly out of place in a combined Spanish banking group. Mr Scholtz said: 'It makes sense for them dispose of the business as TSB has been a non-core business for a a while' Separately on Monday, a tribunal upheld a ruling by the City watchdog against Metro Bank's former chief executive Craig Donaldson and former chief financial officer David Arden that they were knowingly involved in a breach of listing rules. Metro Bank was fined £10m by the Financial Conduct Authority (FCA) in 2022 for publishing false statements to the market in 2018. The regulator found that Mr Donaldson and Mr Arden knew of the errors but published the statements anyway. The Upper Tribunal has now upheld the FCA's decision. Mr Donaldson and Mr Arden have 14 days to appeal. Steve Smart, executive director at the FCA, said: 'Investors make decisions based on information shared by listed companies. They must be able to trust it's accurate. Mr Arden and Mr Donaldson allowed information they knew to be wrong to be published.' Broaden your horizons with award-winning British journalism. Try The Telegraph free for 1 month with unlimited access to our award-winning website, exclusive app, money-saving offers and more. Sign in to access your portfolio
