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Q3s preview: not so great expectations for Lloyds, NatWest, Barclays & HSBC

As broader economic pain mounts, the UK’s largest listed banks’ loan provisions remain a work-in-progress
Q3s preview: not so great expectations for Lloyds, NatWest, Barclays & HSBC
  • Third-quarter results are unlikely to feature positive surprises
  • Despite this, 2020 forecast loan loss provisions are flat since the summer
  • Political headaches and unexpected credit issues remain the focus

Last month, the value of the FTSE 350 Bank Index fell below the nadir reached in the 2008-09 banking crisis. That marks a decline of more than four-fifths over 15 years, during which time the total shareholder return looks scarcely better: reinvesting dividends in the sector would still have resulted in a near two-thirds decline.

Against this backdrop, it’s safe to say the market isn’t holding out for many positive surprises when the UK’s largest listed banks begin to publish their third-quarter numbers next week. So far in 2020, the trajectory for lenders has been almost entirely downhill.

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