Lloyds Banking Group (LLOY) 🏦 💰 - Share Chat

https://www.ii.co.uk/analysis-commentary/uk-bank-sector-results-season-these-are-likely-winners-ii524705

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https://www.londonstockexchange.com/news-article/LLOY/2022-half-year-results-part-2-of-2/15557663

https://www.londonstockexchange.com/news-article/LLOY/2022-half-year-results-part-1-of-2/15557659

Don’t discount dark horse of banking

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People sometimes think putting up interest rates is good for banks because they earn more interest. But it seems they (as I did) forgot to think about loan defaults. I think the interest rate was announced at lunch time and this was the result (Barclays identical)….interesting!

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The graph looks dramatic but it was only -1.36% and the price was lower on Monday.

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When you say about loan defaults? Is that cause the loan has a fixed interest on it and basically ain’t gaining from new interest rise? :thinking:

When people struggle to pay loans back due to the rising cost of living / recession effects & in some cases rising interest repayments

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I’ve never not been able to pay a loan back as in they saying you can have a month off?

So surely Ifyou have a loan or credit you don’t have a choice and have to pay??? :thinking:

You are required to pay unless you take a repayment holiday, however if someone doesn’t have the funds to pay it then you can’t make them pay it.

Defaults typically happen when customers miss payments, putting them in arrears where the business pass the borrowing agreements to debt collection agencies or when a customer declare bankrupt. In both cases it is unlikely that full or majority of the loans will be received back by the business, putting them at a loss for that agreement.

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Ex-Dividend day was yesterday

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As @Wrighty1423 points out it was ex-dividend day and the vast majority of stocks take a dive on these days as investors dump the stock after the company take their investor snap shot for locking in a dividend payment, which can impact the share price on such days.

It could also be a coincidence that this also happened on the same day the BOE raised interest rates :thinking: :man_shrugging:t2:

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On ex dividend date a company needs to be re priced. The day before they had several hundred million in cash which has now been committed to be distributed. Without this cash the company is worth less so while you’ll find a small minority of people selling on ex dividend date a rational market should reprice the stock.

If you look at the largest shareholders for a company like this you’ll find the top 10 are almost certainly institutional investors and asset managers - these people don’t ‘trade’ based on dividends.

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Is the ex day, the day the funds are separated from the value of the company, then stored in bank accounts ready to go.

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Yeah that’s the right way to think about it. The day the actually send the money isn’t important from a valuation perspective.

What happens to dividends of share that are un-bought? Shares nobody actually owns

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Good question there :thinking::thinking:

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If a share is ‘un brought’ it means it is not in circulation and held by the company in treasury. A company cannot pay a dividend to itself so nothing happens.

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