Lloyds share price slides as watchdog defers PPI claims decision

on Dec 9, 2016
Updated: Oct 21, 2019

Shares in Lloyds Banking Group (LON:LLOY) have lost ground in London this morning, underperforming the broader market, as the Financial Conduct Authority (FCA) delayed its decision on setting a deadline for claims for mis-sold payment protection insurance (PPI). The lender, bailed-out by the UK government during the financial crisis, has the biggest PPI bill so far, having sold more such policies than any of its peers.

As of 10:04 GMT, Lloyds’ share price had lost 1.36 percent to stand at 61.74p, underperforming the benchmark FTSE 100 index which has climbed marginally higher and is currently 0.10 percent better off at 6,938.68 points. The group’s shares have lost more than 15 percent of their value over the past year, as compared with about an 11-percent rise in the Footsie, and continue to trade well below the government’s break-even price of 73.6p.

The FCA, which launched a consultation in August whether to effectively set a deadline in June 2019 for people to make PPI claims, announced today that it was postponing its decision on the matter to the first quarter of next year. The watchdog had previously signalled that it would make a decision by the end of the current year. The move leaves banks, including Lloyds, potentially exposed to claims for longer.

Lloyds, which has sold more such policies than any of its peers, has already set aside more than £16 billion over the scandal.
The 22 analysts offering 12-month price targets for Lloyds for the Financial Times have a median target of 66.00p on the shares, with a high estimate of 93.00p and a low estimate of 40.00p. As of December 3, the consensus forecast amongst 29 polled investment analysts covering the bailed-out lender has it that investors should hold their position in the company.
As of 10:38 GMT, Friday, 09 December, Lloyds Banking Group share price is 59.42p.

Are you looking for signals & alerts from pro-traders? Sign-up to Invezz Signals™ for FREE. Takes 2 mins.


Want easy-to-follow crypto, forex & stock trading signals? Make trading simple by copying our team of pro-traders. Consistent results. Sign-up today at Invezz Signals™.

Learn more
Finance & Banking Stock Market