The Lemon Fool

johnhemming wrote:

scrumpyjack wrote:It can't make economic sense to raise more equity when the shares trade at almost half net asset value. Why would shareholders want to put more money in for such low returns?

Its a regulatory issue for Banks.

Following the announcement last year that Lord Blackwell intended to retire as Chairman of Lloyds Banking Group over the coming year, the Group is pleased to announce that Robin Budenberg CBE has been selected as his successor. Robin will join the Group Board on October 1st 2020 and take over as Chair in early 2021 when Lord Blackwell steps down from the Board.

During a long career with S.G. Warburg/UBS Investment Bank, Robin Budenberg worked closely with the Government in 2008 as an advisor on the recapitalisation of the UK banking industry. In 2009 he became Chief Executive, then Chairman, of UK Financial Investments (UKFI) with responsibility for managing the UK Government's investment in UK banks, including Lloyds. In 2014, Robin became London Chairman of Centerview Partners, the US based independent advisory firm, and in 2016 he was appointed Chairman of The Crown Estate, which has a diverse £14 billion portfolio with its profits remitted to the Treasury for the benefit of the public finances. Before he assumes the role of Chair of Lloyds Banking Group he will step down from his current roles at Centerview Partners and on the boards of Big Society Trust and Charity Bank, but will continue as Chairman of The Crown Estate. His selection followed an extensive search process led by the Group's Senior Independent Director, Alan Dickinson.

With the Chair succession now in place, António Horta-Osório has also informed the Board of his intention to step down as Chief Executive in 2021 after having delivered three strategic plans and completed 10 years in the role next year.

António has agreed to time his stepping down as Group CEO to support a smooth transition, with a target date at the end of June next year, at which point he will retire from Lloyds. Until then he will continue to be completely focused with the executive team on delivering the remainder of the current strategic plan (GSR3), as well as the plans put in place to address the Covid 19 pandemic effects and support our customers during these difficult times.

Lloyds Bank (LLOY.L) has joined the roll-call of banks setting aside billions more to deal with bad loans as a result of the COVID-19 pandemic, earmarking another £2.4bn ($3.1bn) on Thursday.

The bank said it had set aside an extra £2.4bn to cover an expected rise in the number of credit cards, mortgages, and loans going bad as a result of the crisis. Analysts had expected Lloyds to set aside £1.5bn.

“We have seen the UK economy deteriorate since the first quarter,” chief executive António Horta-Osório said on a call with journalists.

The extra provisions in the second quarter mean Lloyds has now set aside £3.8bn in the last six months. The bank said it would likely end up setting aside as much as £5.5bn by the end of the year.

johnhemming wrote:I bought a few more Lloyds at about 25.9 this morning. Without the dual problems of Brexit and Covid-19 Lloyds would be worth around 80p plus. Both issues will come to some form of resolution at some stage and if Lloyds makes a profit this year (as is forecast - it did actually make a post tax profit this half) then it is unlikely to be asking for more capital.

Obvoiusly there are the questions about a second wave. However, we have recently up to date figures in the UK which do not show any second wave. Getting reliable figures from elsewhere takes a bit of effort, but it still appears that the only places that are getting proper second waves are places which did not have a first wave.

NoBidNoOffer wrote:You do realise the shares have fallen 95% over 20 years and 50% over the past 10 years. If you are hoping that they will get to 80p (which is a pipe dream) then you best speak to the people,who bought them at 30p, 40p, 60p. 70p, 80p etc. as they all thought the exact same thing.

johnhemming wrote:

NoBidNoOffer wrote:You do realise the shares have fallen 95% over 20 years and 50% over the past 10 years. If you are hoping that they will get to 80p (which is a pipe dream) then you best speak to the people,who bought them at 30p, 40p, 60p. 70p, 80p etc. as they all thought the exact same thing.

It is true that they only got to 79.1 in 2015, but the price history over 20 years is not relevant to what the stock might do in the future.

There are two factors holding them back
Covid - 19
and
Brexit.

As far as Covid-19 is concerned it will become clearer that for the England at least the epidemic is on its way out. Brexit remains an issue, but Johnson may compromise on doing the most harmful stuff.

scrumpyjack wrote:... new competition from internet based banking from competitors who do not have the overhead of branch networks...

flyer61 wrote:I have been musing whether the UK insurers are about to put in some bank like share price performance shortly. All out for me, only banks I now hold are Handelsabanken and the Bank of Montreal.