Lloyds share price: Group to raise rates on some savings accounts

Written by: Alice Young
March 11, 2020

Lloyds Banking Group (LON:LLOY) will raise interest rates on some of its savings accounts, Reuters has reported. The move came after the Bank of England (BoE) recently hiked the bank rate.

Lloyds’ share price has slipped marginally lower in today’s session, having given up 0.28 percent to 61.21p as of 10:30 BST. The stock is underperforming the broader UK market, with the benchmark FTSE 100 index having climbed into positive territory and currently standing 0.11 percent higher at 7,650.71 points. The group’s shares have lost more than five percent of their value over the past year, as compared with about a four-percent gain in the Footsie.

Lloyds to raise some rates

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Reuters reported yesterday that a Lloyds spokeswoman had said that the lender would raise interest rates on a number of its fixed and variable rate savings accounts at the end of the month. The bank’s decision includes rate rises of 0.5 percent on Individual Savings Accounts (ISA)and 0.7 percent on fixed rate accounts, with the change expected to affect millions of savers.

The move follows the BoE’s decision to raise interest rates above their financial crisis lows earlier this month, with the bailed-out lender the first of Britain’s ‘Big Four’ banks to confirm it will pass the move on to savers. The newswire notes that Lloyds and FTSE 100 peer Barclays (LON:BARC) had already said that  they will increase some of their borrowing rates as a result of the central bank’s decision.

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Analysts on bailed-out lender

Goldman Sachs, which sees Lloyds as a ‘sell,’ set a price target of 56p on the shares last week. According to MarketBeat, the bailed-out lender currently has a consensus ‘hold’ rating and an average price target of 74.90p.

UBS trimmed its price target on Lloyds last week, pointing to lowered peer group trading multiples in its sum-of-the-parts valuation.

As of 10:47 BST, Tuesday, 14 August, Lloyds Banking Group share price is 61.20p.