- Decent showing on rising interest rates
- Mortgage loan risks are rising
Rising interest rates are, in part, good news for the nation’s largest mortgage lender, which saw its net interest margin increase in these results to 2.77 per cent, up from 2.5 per cent this time last year. However, without outside intervention to improve profitability, still the impression remains that Lloyds Banking (LLOY) is left in no-mans-land: too big to fail, but also too big to adapt its lending business model. Which is a shame as the results were generally better, particularly the second-quarter performance, than the market had expected. It is still a measure of how sensitive the bank is to the UK’s stuttering economy that few investors are prepared to give it much credit for any kind of decent showing.