British Bank Shares Rise On Hopes Of Higher Dividends

Feb. 19, 2008 - PRLog -- The British government's decision to nationalise beleaguered lender Northern Rock has prompted a rise in share values for the major UK banks.

Prices for Barclays and Lloyds soared yesterday on speculation that the two banks will increase their dividend payouts when they report their annual profits this week.

Barclays was up 7.6 per cent to top the gainer's list on the FTSE and was the largest blue chip gainer in Europe, the Bloomberg news agency reports.

Meanwhile, Lloyds TSB rose by 7.3 per cent.

Commenting on development, Bear Stearns analyst Robert Sage said: "This is slightly positive for the sector as the expected managed decline in the Northern Rock balance sheet should create less competitive mortgage market conditions."

Elsewhere, Royal Bank of Scotland, Standard Chartered and Bradford & Bingley added 3.1 per cent, 4.1 per cent and 1.7 per cent respectively.

A statement from FTSE issued yesterday said that Northern Rock will remain a constituent of stock market indexes until further notice.

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