Lloyds' Interest Margin Could be Squeezed by Deposit Competition
Dow Jones10-16
0747 GMT - Lloyds Banking Group could face increased net interest margin pressure from intense competition in the U.K. deposit market, RBC Capital Markets' Benjamin Toms and Sherry Lin write. The market for customer savings has continued to be competitive through the third quarter, RBC says. Lloyds has a higher loan-to-deposit ratio, which poses a challenge in a competitive deposit environment, the analysts note. RBC reduces its 2028 pretax profit estimate for Lloyds by 6%, as it reduces both its net interest margin and loan growth estimates. RBC lowers its recommendation on the stock to sector perform from outperform, and cuts the price target to 115 pence from 124 pence. Shares are down 1.9% at 103.85 pence.
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