INVESTING SHOW: Are Lloyds, NatWest, Barclays and HSBC primed for recovery profits - and will investors ever fall back in love with bank shares?

By THIS IS MONEY

Updated:

Britain's big four banks' shares have been in the doldrums for years and sank once more as the coronavirus crisis hit.

Lloyds, HSBC, Barclays and NatWest have all reported that things aren't as bad as first feared, so could investors fall back in love with banks again? 

On this episode of the Investing Show, Richard Hunter, of Interactive Investor, and This is Money's Simon Lambert delve into the big name banks, how they differ, and the challenges and opportunities they face.

From British economy bellwether Lloyds, to global mega bank HSBC, are they primed for profit in the recovery or will this be yet another false dawn?  

Banks went into the Covid crisis in a considerably better position than through most of the financial crisis hangover and then set aside huge sums to deal with the economic impacts of lockdown.

But with recovery proving stronger-than-expected and the hit from bad loans not as bad as first thought, many of the big banks have released some of their emergency pile and are positioning themselves for growth as economies bounce back.

But the release of money set aside has flattered recent results and for many investors banks have major drawbacks: they have not been forgiven for the financial crisis and memory of their share price crashes lives on, while the big names are seen as utility -type stocks.

Meanwhile, even though higher interest rates and a dose of inflation are generally considered better for bank profits, their share prices have sunk with the wider market as it throws an inflation-fear wobble over the past week.

But does their unloved status make Britain's big banks a value opportunity or a wealth trap for money that could be put to better use elsewhere? 




THE INVESTING SHOW

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