IN FO­CUS: LLOYDS BANK­ING GRP ‘ IT SUR­VIVED A NEAR- DEATH EX­PE­RI­ENCE’

The Daily Telegraph - Your Money - - INVESTING -

The bank­ing sec­tor has had a near-death ex­pe­ri­ence and many peo­ple have un­der­es­ti­mated what that means for its fu­ture be­hav­iour. The cri­sis changed the way the bank­ing sec­tor op­er­ates for­ever.

For the past 10 years, banks have been re­peat­edly stresstested, and Lloyds has had to go through all the skele­tons in its cup­boards.

We have in­creased our stake be­cause we be­lieve that be­hav­iour at the banks is get­ting bet­ter and Lloyds’ fi­nan­cial po­si­tion has im­proved.

The way that banks at­tract cus­tomers and how they use tech­nol­ogy mean that they are bet­ter in­te­grated into so­ci­ety than be­fore. There is less price-goug­ing of cus­tomers be­cause reg­u­la­tion has im­proved and banks are in­vest­ing more than they have ever done.

While Lloyds is not a buoy­ant com­pany, it has been very sta­ble. When you’re look­ing at the global bull mar­ket that we have been in for eight years, there are very few com­pa­nies that aren’t trad­ing at all-time highs. Lloyds is one of those.

We like that the cash the bank gen­er­ates comes back to in­vestors in the form of div­i­dends or stock buy-backs. come, given the in­creas­ing num­bers of peo­ple en­ter­ing the mid­dle classes around the world. This will sup­port long-term price growth and good div­i­dend growth.

And your big­gest fail­ure?

We’ve had po­si­tions in tele­coms that just haven’t worked. The les­son we learnt was that we needed to look more at the reg­u­la­tory and po­lit­i­cal en­vi­ron­ment, and how this was go­ing to have a sig­nif­i­cant im­pact on a busi­ness.

Do you have your own money in the fund?

Yes, ab­so­lutely. My­self and my fam­ily are in­vested.

How are you paid?

I am paid based on the per­for­mance of me, my team and Black­Rock as a whole.

What would you have been if you weren’t a fund manager?

I would love to have been a fighter pi­lot. I was con­vinced that would be my job when I was eight years old and I still haven’t shaken that dream.

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