London, January 20, 2026, 07:56 GMT — Premarket
- UK bank shares are reacting again to tariff news and shifts in Bank of England rate expectations
- Lloyds filed a share plan and is set to report full-year results next week
Lloyds Banking Group (LLOY.L) ended Monday at 102.30 pence, up 0.2%, after swinging between 100.20p and that close. The stock sits close to recent peaks as Tuesday’s London session approaches. 1
The FTSE 100 slipped 0.4% on Monday, weighed down by President Donald Trump’s threat of new tariffs targeting Britain and seven other European countries. That move rattled risk appetite, dragging markets lower. 2
In Europe, stocks took a hit across the board, reigniting fears about trade tensions. Andrew Kenningham, chief Europe economist at Capital Economics, expressed skepticism, saying, “We doubt that (the tariffs) will be implemented as advertised.” Kyle Rodda, senior market analyst at Capital.com, flagged the weekend move for “reintroduc[ing] trade uncertainty.” 3
On Tuesday, new UK labour-market figures hit the tape, providing a snapshot for Bank of England policy watchers. Payrolls dropped by 43,000 in December, while private-sector pay growth, excluding bonuses, dipped to 3.6% in the three months ending November. By Monday, markets had fully priced in at least a quarter-point rate cut for 2026. 4
For Lloyds, the mix is crucial since it leans heavily on the UK consumer and the mortgage cycle. If bets on rate cuts intensify, investors will zero in on the impact on lending margins and whether weaker growth pushes up bad-loan charges.
On Monday, the company released a technical update following the UK Listing Rules scrapping the “block listing” regime—a method firms used to pre-list shares for employee schemes. Lloyds reported holding 231,000,732 unallotted ordinary shares across its share plans and plans to announce any allotments within 60 days of them happening. 5
The bigger headache lies elsewhere. Lloyds booked an £800 million charge linked to the motor finance mis-selling scandal and cut its guidance last quarter. The ultimate cost remains unclear across the sector. 6
The downside risk is clear: should tariff threats materialize into real barriers and UK demand slow more sharply, lenders could face pressure on two fronts — slower loan growth and rising impairments. On top of that, quicker-than-expected rate cuts would put additional strain on margins.
Lloyds is set to release its 2025 full-year results on Thursday, January 29 at 7 a.m. GMT. A management presentation will follow at 9:30 a.m., with investors keen to catch any 2026 guidance and updates on conduct costs. 7
