Banking shares revive

Huddersfield Daily Examiner (Huddersfield, England), Jan 29, 2009

Byline: HENRYK ZIENTEK

LLOYDS Banking Group led a revival in the sector's fortunes after City pundits took a more optimistic view of prospects for the UK banks.

Lloyds, which has completed its rescue takeover of Halifax Bank of Scotland, saw its shares rise by 45% at one point yesterday - while Barclays rose by 24% after rocketing by 73% on Monday following management assurances over funding and profits.

NatWest parent Royal Bank of Scotland was 20% up - recovering some of the 65% plunge it suffered last week after warning of record losses. HSBC rose 9%.

Lloyds, which is 43% owned by the Government, had a disastrous start as a newly-enlarged group when shares halved in value last week due to fears that it would become majority public-owned under Government bank bail-out measures.

But Citigroup said the risks were "exaggerated", adding that full nationalisation was "unnecessary and inconsistent with the stated aims of the Government".