Lloyds shares go on sale to public

UK chancellor to announce £2bn worth of Lloyds Bank shares to go on sale to the public today

Lloyds Q3 results: tips and estimates

Q3 statement tomorrow......07.00 hrs

Speakers on!

The results are going to have quite an impact on the sp tomorrow, imo. The TA guys on IG are saying the trading range is anything from 70p to 82p. I am expecting the results to be 'in-line', which should encourage divi hunters that 2016 might be a good year for LLOY. Am a seller at c81p....will wait for profit takers to bump the sp back to c74p....then will buy back in. That's the plan anyway!

They are one of my biggest holdings and I'm about 45% up on the total holding.

I'm hoping longer term that they will become a significant element of my SIPP.

I also have a largish S/B on from just shy of 76p and hoping for a short term turn.

I am trading them profitably at the moment but will start to stockpile when I think there is a likelihood of a decent divi.

I'm less hopeful on RBS on Friday, but IAG could be interesting if you don't hold/trade!

Interim Management Statement

Improvement in profitability and returns
· Underlying profit of £6,355 million, an increase of 6 per cent on the first nine months of 2014
· Total income flat at £13,205 million1
- Net interest income of £8,578 million, up 4 per cent, driven by margin improvement to 2.63 per cent
- Other income 7 per cent lower at £4,627 million
· Operating costs down 1 per cent despite additional investment and Simplification costs; cost:income ratio improved to 48.0 per cent
· Impairment charge down 64 per cent to £336 million; asset quality ratio improved 15 basis points to 0.11 per cent
· Underlying return on required equity of 15.7 per cent, up 1.7 percentage points on the first nine months of 2014
· Other income weaker in the third quarter partly offset by lower costs and impairments
· Statutory profit before tax up 33 per cent to £2,151 million (2014: £1,614 million). PPI provision of £500 million in the third quarter primarily reflects sensitivity run-rate previously disclosed at the half year
· Statutory return on required equity of 4.4 per cent, up 0.5 percentage points on the first nine months of 2014

Balance sheet further strengthened
· Strong balance sheet and liquidity position
- Common equity tier 1 (CET1) ratio of 13.7 per cent (31 Dec 2014: 12.8 per cent, 30 June 2015: 13.3 per cent)
- Total capital ratio of 22.2 per cent (31 Dec 2014: 22.0 per cent, 30 June 2015: 21.7 per cent)
- Leverage ratio of 5.0 per cent (31 Dec 2014: 4.9 per cent, 30 June 2015: 4.9 per cent)
· Tangible net assets per share of 55.0 pence (31 Dec 2014: 54.9 pence, 30 June 2015: 53.5 pence)

Our differentiated UK focused business model continues to deliver
· Delivering growth in targeted areas, gaining market share in SME and Consumer Finance and meeting our Helping Britain Prosper Plan commitments by supporting first-time buyers and business start-ups
· Cost discipline and low risk business model providing competitive advantage
· UK government stake reduced to less than 11 per cent (as at 9 October 2015)

Guidance for 2015 updated
· Net interest margin for the full year now expected to be in line with year-to-date performance (2.63 per cent)
· Asset quality ratio now expected to be lower than 15 basis points for the full year
· Other income expected to recover in the fourth quarter but full year now expected to be slightly below 2014
· Remaining guidance unchanged

Outlook
· The robust UK economy and our differentiated business model underpin our continued confidence in generating strong and sustainable returns.

1 Total income, operating costs and impairment exclude TSB.

Lloyds hit by further charge for insurance mis-selling

Surprised its down 4% ;-(

Seems analysts are not happy with the pre-tax profit figure, which has fallen short of the estimates.

Yes not too clever atm.

Investec Buy 73.93 86.00 86.00 Reiterates

Nomura note:
"Investment case from here -Lloyds has missed consensus largely owing to weaker other operating income (OOI) driven by insurance and commercial banking. Reported NIMs came in better than expected at 264bp in the quarter and in line with our expectations. However, average interest earnings assets (AIEA) continues to be lower than expected despite customer loans increasing, which suggests underlying margin pressures.
Looking into 2016 we expect to see revenue downgrades to the tune of GBP 400m-500m mainly owing to OOI. However, cost control was strong in the quarter and asset quality continues to surprise, so most of this revenue downgrade will be offset. Longer term estimates might see more of an impact as consensus will look to normalise cost of risk, rather than pass on the 3Q beat.
Lloyd’s investment case is driven by its potential dividend yield. With distributable underlying earnings yield (including DTAs) at c12%, our longterm expectation remains that Lloyds will deliver a top decile dividend yield from current valuation in the long run. In this context, PPI costs falling to GBP 0.6bn in 3Q14 from a 1H15 level of GBP 1.7bn will be seen as a positive. CET1 ratio improved 40bp in the quarter to 13.7%. While weaker than our expectation, it still underpins our 3.25p distribution expectation for the year against consensus of 2.6p. We would find this a particularly good buying opportunity on any weakness.
Key points from the results
• NII came in at GBP 2,863m against consensus of GBP 2,937m. Reported NIMs were better than expected at 9M15 level of 263bp or 3Q15 level of 264bp. However, AIEA fell 1% to GBP 438.7bn, while customer loans
grew 0.7% to GBP 455bn, so the denominator has helped report better NIMs.
• Other operating income was the main source of weakness coming in at GBP 1,374m against consensus of GBP 1,622m. The weakness is driven by non-repeat of bulk annuity income and weak OOI in commercial
banking. This will be the main source of revenue downgrade looking into 2016-17.
• Cost control was evident in the quarter, coming in at GBP 2,108m against consensus of GBP 2,240m, offsetting some of the revenue downgrades.
• Cost of risk came in better at GBP 157m against consensus of GBP 225m.
• CET1 at 13.7% is among best in the sector (ex Scandi) and will underpin our above consensus 3.25p distribution expectation (consensus at 2.6p). TBV grew by 2.8% to 55p."

Still dropping.......sub 72p looking likely.

Deutsche Bank retains buy on Lloyds Banking Group, target cut from 96p to 91p.

Share price also suffering from more selling by HMG yesterday!

And the other Brokers.

Barclays Capital Overweight 73.19 105.00 105.00 Retains

Societe Generale Buy 73.19 100.00 98.00 Reiterates

JP Morgan Cazenove Overweight 73.19 105.00 98.00 Reiterates

Berenberg Sell 73.19 55.00 55.00 Reiterates

No UKFI selling today with shares below 73.6p...all down to the computers now

I didn't see the HMG sale yesterday. What %age is still remaining with them?