London, Jan 30, 2026, 08:06 GMT — Regular session
Lloyds Banking Group plc shares (LLOY.L) climbed 1.2% to 106.7 pence in early Friday trading, following the launch of a share buyback program valued at up to £1.75 billion. The stock hit a 52-week peak of 107.10 pence just the day before. (Investing)
The bank announced the programme kicks off on Jan. 30 and will continue until Dec. 31, 2026, at the latest. Goldman Sachs International will handle the purchases and make trading decisions independently. Lloyds plans to cancel the shares and pointed out the buyback still requires ongoing approval from the Prudential Regulation Authority. (Investegate)
Buybacks can boost earnings per share by cutting the share count, but investors remain cautious about the final cost tied to Britain’s motor finance commission review, which involves customer redress linked to car loans. Lloyds recommended a final dividend of 2.43 pence per share, set for shareholder approval at its May 14 annual meeting and payment on May 19. The group also set its total motor finance provision at £1.95 billion and said it expects the regulator’s final redress rules by the end of March. (Lloyds Banking Group)
Just a day earlier, Lloyds announced a 12% jump in its 2025 profit before tax, reaching 6.7 billion pounds. The bank also raised its profitability target, forecasting a return on tangible equity—a key gauge of profit on shareholder capital—above 16% in 2026. “Our continued business momentum and strategic delivery enable us to upgrade guidance,” CEO Charlie Nunn said. He added that Lloyds will brief investors on the next stage of its strategy come July. The bank also highlighted a goal to gain more than 100 million pounds in incremental profit from generative AI by 2026. (Reuters)
Nunn has pushed the AI narrative hard. “This is going to radically change how customers experience financial services,” he told reporters, adding that banks must support staff in “re-skill[ing] themselves” as the technology takes hold, according to the Guardian. (The Guardian)
Lloyds’ jump followed a 0.2% gain in London’s FTSE 100 on Thursday. The UK banking sector index climbed 0.5% as investors absorbed several corporate earnings reports, Reuters said. (Reuters)
Neil Wilson, investor content strategist at Saxo, flagged the “eye-catching bit” for investors: the bank’s aim for a 16% return on tangible equity by 2026. He pointed out Barclays will report on Feb. 10, NatWest on Feb. 13, and HSBC on Feb. 25. These dates set the stage to see if peers match Lloyds by raising their targets. (Saxo Bank)
Lloyds is also changing its approach to excess capital, moving toward more frequent reviews instead of just an annual check-in. This could make the stock more reactive to shifts in regulatory or provisioning expectations.
The motor finance issue remains a cloud over the deal. If the redress scheme proves tougher than anticipated, or if a court expands who qualifies, the company might face new provisions and have to slow down its buybacks.
Traders are set to focus on the initial disclosed buyback purchases and any hints regarding the motor finance redress scheme, with regulators aiming to finalize rules by the end of March. Barclays’ full-year results, coming on Feb. 10, remain the next key catalyst.
