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Banks Reap Huge Profits as Tax Calls Mount
25 Jan
Summary
- Lloyds expects net interest income to reach £13.6 billion.
- Banks earn £20 billion annually from Bank of England deposits.
- Nigel Farage advocates for bank profit taxation and rate caps.
As of January 25, 2026, major UK banks are anticipating significant profit reports in the coming weeks. Lloyds, Britain's largest lender, is projected to announce a net interest income of £13.6 billion, an increase from £12.8 billion reported a year prior. This robust performance is mirrored across the sector, as financial institutions capitalize on sustained higher interest rates.
These banks collectively generate approximately £20 billion annually from interest earned on deposits held at the Bank of England, a result of past quantitative easing measures. This financial success has fueled growing demands for a windfall tax on banking profits.
Prominent political figures, such as Nigel Farage, have voiced strong opinions regarding bank earnings and practices. Farage recently stated at the World Economic Forum that banks would no longer benefit from "free money." He also directed criticism towards Bank of England Governor Andrew Bailey and suggested that "everything is up for discussion" regarding financial regulations, including potential caps on credit card interest rates.
