UK Stress Test: A Look At Winners And Losers

Considering the European Banking Authority conducted its own stress tests earlier this year, results from the Bank of England’s own stress test, released today, don’t contain any real surprises, according to Jefferies analysts Joseph Dickerson, Omar Fall, and William Davison. But they also don’t think Lloyds Banking Group PLC (ADR) (NYSE:LYG) (LON:LLOY) will be able to pay out any significant dividends until 2016 while it continues to build capital.

“Our conclusion is that the results are likely to be worse than the consensus expected for LLOY and that the bank’s ultimate go-to capital ratio is likely to be higher than the 11% that management guides,” they write. “Expectations that LLOY will commence a dividend this year are misplaced.”