The Great Debate UK
It may be junk but it’s cheap junk
– Neil Collins is a Reuters columnist. The views expressed are his own –
Tuesday, May 12 was just another day in the twilight zone that is the market for bank debt and preference shares. As usual, that day’s dividends were paid on time, including the one due on Lloyds Banking Group 6.0884 percent preference shares.
The price hardly twitched; on Collins Stewart’s Thursday daily list, it was offered at 337.50 pounds per 1,000 pounds of stock, to produce a net yield of 18.0 percent.
That hefty return assumes the dividend will go on being paid. It may not be, and missed payments do not accumulate against that distant day when Lloyds returns to prosperity.
