Lloyds Banking Group (LON:LLOY) has dropped Goldman Sachs from the auction of an £109-billion investment contract, the Financial Times has reported. The move leaves BlackRock and Schroders in the race to secure one of Europe’s largest investment mandates after the bailed-out lender moved to pull the assets under management from Standard Life Aberdeen (LON:SLA) earlier this year.
Lloyds’ share price has fallen into the red in today’s session, having given up 0.90 percent to stand at 59.37p. The shares are underperforming the broader UK market, with the benchmark FTSE 100 index currently standing 0.20 percent lower at 7,304.31 points.
Goldman Sachs out of mandate race
The FT reported yesterday that Lloyds had dropped Goldman Sachs from the auction of its £109 billion investment contract. A source close to the auction, codenamed ‘Project Swift,’ told the newspaper that the UK launch of Goldman’s retail bank Marcus had raised competition concerns for the bailed-out lender.
The person close to the bidding process further cautioned that the auction still had more time to run and no final decision had been made. While BlackRock, Schroders and JPMorgan Asset Management were selected to take part in a second round of bids in April with Goldman Sachs Asset Management also joining, another person close to the process told the FT that JPMorgan had since dropped out of the running. SLA, which had been fighting to retain the contract, did not make it to the second round.
Analysts on bailed-out lender
Barclays reaffirmed Lloyds as an ‘overweight’ yesterday, valuing the shares at 90p. According to MarketBeat, the bailed-out lender currently has a consensus ‘buy’ rating and an average price target of 75.45p. Earlier this week, Berenberg lifted its stance on the FTSE 100 group on valuation grounds.