LONDON, March 13, 2026, 13:59 GMT
Lloyds Banking Group shares picked up 0.3% to 95.76 pence Friday, still trading under 1 pound and far from their 52-week peak of 114.60 pence. That modest gain barely dented the gloom after the stock’s steep pullback from its earlier highs this year.
Lloyds stands out here—it’s Britain’s top mortgage lender, so shifts in home-loan appetite or rate outlooks hit it harder than most. Thursday saw the UK bank index slide 4.8%, Reuters noted, as oil prices pushed back toward $100 per barrel. That spike reignited inflation nerves and erased hopes for an imminent Bank of England rate cut.
Signs of a cooling housing market are already showing up. The Royal Institution of Chartered Surveyors reported new buyer enquiries slumped to a net balance of -26 in February, marking the lowest reading since December. RICS research chief Tarrant Parsons pointed to rising oil and energy costs, warning these pressures make it more likely mortgage rates will remain “higher for longer.” Reuters
Lloyds found itself fending off criticism on Thursday following a technical mishap that temporarily exposed some customers to other users’ transactions in its mobile app. The bank moved fast to fix the issue and said it’s now looking into what went wrong.
Relief has been scarce across the broader market. Reuters reported that the FTSE 100 shed 0.3% as of 1058 GMT on Friday, putting it on track for its second consecutive weekly decline. Shares of HSBC and Standard Chartered were lower after disruptions hit their Gulf businesses. For Berenberg’s Jonathan Stubbs, the actual threat comes from any lasting blockage in the Strait of Hormuz, along with “persistently high energy prices.” Reuters
This stands in stark contrast to what Lloyds told investors back on Jan. 29. The bank reported a 12% jump in 2025 pretax profit, hitting 6.7 billion pounds. It bumped its 2026 return on tangible equity target above 16%, and rolled out a 1.75 billion pound buyback. Chief Executive Charlie Nunn credited stronger business momentum for the “upgrade guidance.” Reuters
Shareholders are still looking at returns here. Lloyds has flagged a final 2025 dividend of 2.43 pence per share, according to company data. Anyone picking up shares after April 9 misses out on that payment, set for May 19.
Back earlier this year, Reuters flagged Jefferies projecting Lloyds could hike its medium-term profitability target once again, with return on tangible equity possibly hitting 18.5% by 2028. “Earnings resilience” has given British banks a lift, said Peter Rothwell, who leads banking at KPMG UK. But Shore Capital’s Gary Greenwood pointed out they’re also on the hook to “grow their loan books faster” if they want to support the economy. Reuters
But in the short term, risk is leaning the opposite direction. On Friday, BofA shifted its forecast for the Bank of England’s first rate cut to June, citing a resurgence in inflation risk from higher energy prices that’s now clouding the outlook for policy easing. If that perspective takes hold in the market, domestic bank stocks could remain stuck, buybacks and dividends notwithstanding.
