Latest banking news : UK bank shares rally on stress test and Eurozone news
Latest banking news : UK bank shares rally on stress test and Eurozone news
2010/07/28 by ukcitymedia.co.uk about : Company Reports - 0 Comments - 350 words
Shares in British banks were up yesterday on the FTSE 100 after stress test results from European banks indicated that leading UK banks, Barclays, RBS, Lloyd's and HSBC may not be in such bad shape after all.
Banking shares reacted belatedly yesterday to positive stress test news last week in which only seven small European banks failed the tests designed to see if they could withstand another financial crisis whilst none the UK majors failed the tests.
Deutsch Bank and UBS also posted strong second quarter results yesterday with Deutsch Bank making pre-tax profits of 1.52 billion euro, in line with expectations and UBS reporting better than expected profits of two billion Swiss Francs.
Meanwhile, Lloyds Banking announced today that it is selling its Ecuadorian branch assets and liabilities to Banco Pichincha for approximately $25m in cash with final figure still to be agreed.
Lloyds indicated that its private banking operations within Ecuador would not be part of the sale and that the deal is in line with its strategy of divesting non-core assets. Lloyds Banking Group have sold seven businesses, so far since announcing its strategy, raising over £750m.
Lloyds Banking are also to stop selling payment protection insurance PPI across all of its high street banking businesses Halifax, Bank of Scotland, Cheltenham & Gloucester and all Lloyds branches.
Which magazine chief executive Peter Vicary-Smith commented that "Lloyds decision to stop selling PPI is a huge victory for consumers... hopefully other banks will follow suit and we'll finally see the back of this poor protection product."
PPI was intended to protect if they lose their jobs or become ill but conditions are often so restrictive to make the insurance product almost useless. Moneysavingexpert commented that the insurance has been mis-sold for years leaving many consumers and is estimated to be worth up to £5bn a year for the industry.
The FSA has previously indicated that it wants a complete ban on the sale of PPI policies while Lloyds said existing policies will stay in force and be unaffected by the decision.
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