Fidelity's Karunathilake backs Lloyds for first time in three years

Fidelity's Aruna Karunathilake has bought into Lloyds for the first time in three years to take advantage of the stock's depressed valuation.

Although UK domestic-focused banks have been widely avoided by most fund managers, Karunathilake included, the manager of Fidelity’s £261m UK Aggressive fund says the risks facing Lloyds are now in the price. “I have not owned the stock since 2008 but I bought Lloyds last month as the valuation is so cheap,” he says. “It is a value play for me, and the risks are factored into the price.” The stock is trading at about 60p, having pulled back over 10% from the highs seen in February. Karunathilake adds: “I focus on tangible book value per share, and when Lloyds went below 64p per sha...