S&P boosts Lloyds and RBS

Standard & Poor’s, the credit rating agency, has upgraded its stance on government-backed Lloyds Banking Group and Royal Bank of Scotland in a move that underlines the recovery at the two banks. S&P raised the ratings on the institutions one notch from BBB to BBB+. Lloyds, 41 per cent owned by the taxpayer, bounced back to profit in the first quarter of this year while RBS narrowed its losses and said its recovery plans were on track. S&P believes the groups have taken control of their margins and are beginning to rein in their reliance on wholesale funding.