London, January 11, 2026, 09:41 GMT — Market closed
- Lloyds’ board is preparing a new executive pay policy that could lift CEO Charlie Nunn’s maximum award, a media report said.
- Investors head into Monday watching for any spillover into sentiment ahead of the bank’s late-January results.
Lloyds Banking Group plc (LLOY.L) is preparing a new executive pay policy that could lift chief executive Charlie Nunn’s maximum annual award to about 13.2 million pounds, the Guardian reported on Sunday. The report said shareholders would vote on the three-year policy at the bank’s annual general meeting, as peers such as Barclays, HSBC and NatWest have lifted pay ceilings since Britain removed the banker bonus cap. 1
Lloyds shares last closed at 100.30 pence on Friday, up 0.25% on the day, and close to a 52-week high of 101.70p. The broader FTSE 100 index rose 0.8% on Friday. 2
The timing matters. Lloyds is due to publish preliminary results for 2025 on Jan. 29, and its annual report and accounts on Feb. 18, according to its investor calendar. 3
Jefferies analysts Jonathan Pierce and Priya Rathod called Lloyds “a slow-burn story of long duration, holistically managed hedges supporting consistent delivery of guidance” and wrote: “But in 2026, the thesis gathers pace.” They expect a bigger payout mix at full-year results, including a possible move to half-yearly share buybacks and a dividend per share around 3.5p, City AM reported. 4
A share buyback is when a company repurchases its own stock, shrinking the share count. That can lift earnings per share if profits hold, and it is a blunt message that management thinks it has capital to spare.
The pay story adds a different sort of pressure. Bigger top-end awards can draw scrutiny in London even when most of the package hinges on performance targets and multi-year vesting, and investors sometimes treat the vote as a proxy for trust in the board.
But the bigger downside risk for Lloyds is still the open-ended bill from motor finance redress and how regulators choose to settle it. The Financial Conduct Authority has consulted on an industry-wide compensation scheme and said it expects to publish final rules in early 2026 if it proceeds.
Rates are the other moving part. UK rate expectations drive banks’ net interest margin — the gap between what they earn on loans and pay on deposits — and a faster cut cycle can squeeze that spread, particularly for lenders with heavy UK retail exposure.
Peers will shape the backdrop too. Investors are watching for read-across from other UK banks on capital returns and credit costs, even if the pay debate stays a Lloyds-specific flashpoint.
Monday’s open will show whether the governance headlines dent appetite for the stock or fade into the background. The next hard catalyst is Lloyds’ Jan. 29 results, when traders will focus on dividend, buyback and any update on redress exposure.
