Lloyds TSB has this week increased the rates of interest offered on its Plus current account to 6 percent, an enormous 2 percent more than it was previously.
The new higher interest rate is being offered on this particular Lloyds TSB current account for new customers opening their account before July 13. The only proviso is that at least GBP1,000 per month must be paid into the account, something that is quite common anyway.
Increasing their interest rate is quite a move for Lloyds TSB, though they appreciate that customers in the UK tend to be quite fixed when it comes to their current accounts, tending to stay with the same bank for many years. Lloyds therefore feel they have to really make an impact with their message in order to get people to consider moving and an impact it certainly is.
Barclays saw a drop in profits of a third for the first half of the year, with write downs impacting seriously on the bottom line. Barclays Insurance though, a division of the bank, performed very well.
The bank still made profits of GBP2.75 billion despite the write downs and, even though the bank itself was disappointed, industry analysts felt this was better than could have been expected. Other financial institutions have suffered much more dramatic cuts than Barclays, insurance and other sectors helping support the bank.
Looking forwards the Barclays management team are expecting trading conditions to remain testing and are advising the market that it could be some time before they are back to previous levels of profitability. Barclays Insurance, having performed very well, may actually see some parts of it sold to bolster the balance sheet.
Abbey National owner Santander has reported profits for the first six months of the year up by 6 percent compared with the same time last year.
If a one off figure was removed from the figures then the actual profit generated by Santander, best known in the UK as the owner of the Abbey National, would have been a much higher 22 percent. This figure is also higher than analysts had predicted, although shares still traded down slightly on the day.
Santander are very much a global business, with connections to most parts of the world. This enables them to find many more opportunities to create profitable business since they are not tied to just one market. However even the Abbey National delivered good results for them, something that could not always have been expected with the economic situation currently facing UK businesses.
