Investor demand sends TSB soaring
SHARES in TSB jumped as much as 15pc on its debut on the stock market in London yesterday amid booming demand from investors.
The stock was listed at 260p but soared above 300p in early trading before closing at 290p – valuing the challenger bank at over £1.45bn.
It marked a successful return to the stock market for TSB which is being spun out of state-backed lender Lloyds Banking Group. Lloyds opted to sell 35pc of TSB, rather than the 25pc initially planned, following a late surge in demand from investors. Some 30pc of the shares on offer have been allocated to retail investors who will be able to start trading on Wednesday next week.
Sources said that of the institutional investors to snap up shares, around 40pc were in the UK, 40pc in the US and 20pc in Asia and the rest of the world. The 10 biggest shareholders received half of the institution book and the top 20 over two-thirds.
TSB chief executive Paul Pester said the demand ‘shows there is real appetite for a different kind of bank – a High Street bank, not a Wall Street bank – which is focused on customer service’. Lloyds was ordered to sell the 631 TSB branches by European regulators by the end of 2015 following its £20bn bailout by the UK government during the financial crisis. The float raised £455m and sees TSB return to the market for the first time since 1995 when it merged with Lloyds. INFLATION has tumbled to its lowest level for four-and-a-half years, according to figures published this week by the Office for National Statistics.
The consumer prices index rate of inflation fell from 1.8pc in April to 1.5pc in May – a level not seen since October 2009.
It was the sixth month in a row that inflation has been at or below the Bank of England’s 2pc target.
Family food bills fell for the first time in eight years last month as a supermarket price war helped ease pressure on family finances.
Lower air fares also helped bring inflation down.
But the squeeze on household budgets remains acute with the average worker currently getting an annual pay rise of just 0.7pc.