Lloyds, Barclays and RBS share prices ahead of Brexit
Brexit continues to hinder the performance of British lenders, with uncertainty stifling investment and squeezing margins on UK mortgage margins.
Technical analysis from our experts
'A move above 160p would put Barclays' share price above the July and September peaks, providing a more bullish view. A drop below 145p reaffirms the bearish view and brings the August low at 135p into play...'
Find the full detailed analysis in our platform now
No-deal Brexit will hit domestically focused Lloyds hardest
Lloyds has taken strides to become a more domestically focused retail bank, tying its performance more closely to that of the wider UK economy.
In the event of Britain bailing out of the EU without a deal, the UK economy is predicted to suffer greatly in the short term, which would spell disaster for British lenders, with Lloyds likely to feel the impact more acutely than its rivals.
Barclays cuts costs ahead of Brexit
Earlier this year, Barclays recorded an 82% rise in half-year pre-tax profits despite ongoing Brexit uncertainty applying downward pressure on its share price
However, it is worth noting that the surge in profits, reflected the lack of additional charges which significantly hurt earnings during the same period last year, with the bank forced to settle with US authorities over its involvement in selling mortgage-backed securities ahead of the financial crisis.
Barclays and other UK lenders are not only contending with the uncertainty caused by Brexit, but also a competitive mortgage market and the threat of a global economic slowdown.
Consequently, Barclays is focused on cutting costs in second half of this year, with the lender shedding more than 3000 jobs across its operations in its second quarter (Q2) alone.
‘Management focus on cost control remains a priority, and we expect to reduce expenses to below £13.6 billion for 2019,’ Barclays Group CEO Jes Staley said.
Alison Rose to navigate RBS post-Brexit
In September, RBS announced that Alison Rose will take over from Ross McEwan as CEO – making her the first women to lead one of Britain’s top banks.
Rose will take the helm in November, which will see her forced to navigate the bank through a post-Brexit landscape, so long as the 31 October deadline isn’t push back.
Her job will be made all the more difficult by the government still controlling a significant stake in RBS and, depending on the type of Brexit the UK ultimately gets, progress towards privatisation could be hampered.
‘This is an exciting time as we enter a new chapter for this bank,’ Rose said. ‘Our industry is facing a series of challenges; from the ongoing economic and political uncertainty to shifts in the behaviour and expectations of our customers, driven by rapid advances in technology.’
‘It will be my priority to make sure we are ready to meet these challenges and build the best bank for families, businesses and communities,’ she added.
The information on this page does not contain a record of our trading prices, or an offer of, or solicitation for, a transaction in any financial instrument. IG Bank S.A. accepts no responsibility for any use that may be made of these comments and for any consequences that result. No representation or warranty is given as to the accuracy or completeness of this information. Consequently any person acting on it does so entirely at their own risk. Any research provided does not have regard to the specific investment objectives, financial situation and needs of any specific person who may receive it and as such is considered to be a marketing communication. Although we are not specifically constrained from dealing ahead of our recommendations we do not seek to take advantage of them before they are provided to our clients. See full non-independent research disclaimer.
Trading around Brexit
Find out how Britain’s EU exit continues to affect traders, and discover:
- How you can trade on Brexit
- The markets you should be watching
- Brexit trading strategies for key assets
Live prices on most popular markets
You might be interested in…
Find out what charges your trades could incur with our transparent fee structure.
Discover why so many clients choose us, and what makes us a world-leading provider of CFDs.
Stay on top of upcoming market-moving events with our customisable economic calendar.