Lloyds stock up on dividends pledge

Lloyds Banking Group has told potential investors it expects to pay out up to 70% of its earnings in dividends by 2015, the Financial Times reported, sending shares in the British bank up over 3% in early trading yesterday.

Britain owns 39% of Lloyds and is gearing up to start selling shares in the bank after they surged well above its break-even price of 61p. Lloyds chief executive Antonio Horta-Osorio said at half-year results last week that he expects the bank to be a high-dividend paying stock in the future, potentially paying out at least half of its earnings.

The Financial Times said he had told investors he was targeting a 70% ratio, far above British rivals and most global peers, citing people involved in the meetings.