Lloyds Banking Group PLC, Natwest Group PLC and Barclays PLC all buys

Christmas has come early for the UK banks in the shape of the Bank of England raising interest rates according to brokers today, who were rushing to put out ‘buy’ notes across the sector.

UBS gushed “With the UK domestic banks trading as low as 6x 2022E EPS and holding excess capital and excess loan loss reserves, we think the banks are extremely good value at current levels.

HSBC is its top pick in the UK with Barclays favoured among the domestic names. Virgin Money is best of the mid-caps.

Citi was no less enthusiastic.

The rate hike was “earlier than we, and the market, anticipated following the onset of the Omicron variant.”

NatWest Group PLC (LSE:NWG) has the greatest earnings gearing to BoE rate hikes in Citi’s view while Lloyds has the greatest upside relative to consensus forecasts.

Buy both says Citi, though it adds it is overweight on the sector generally and especially UK domestic banks rather than internationals.

Bank shares shot up yesterday after the BoE acted and ran into some profiting today though Lloyds was still up 0.2% to 46.5p.