Banking sector good value on back of attractive yields

UK banks have been racing each other to the top of the market over the past 10 years but more recent...

UK banks have been racing each other to the top of the market over the past 10 years but more recently, and for the foreseeable future, question marks hang over the sustainability of the sector. Competition and consumer spending have both contributed to a slowdown in the sector and bad debts are rising, albeit from a low base. However, Richard Colwell, UK manager at Credit Suisse, does not believe the sector will fall back to the poor return situation it was in 15 years ago. "We are not going to see spikes in bad debt as in previous cycles," he says. "The issue revolves around whether i...