Woolnough: Why banks will struggle for next 20 years

M&G's Richard Woolnough is maintaining his underweight to UK banks as he predicts the sector will not see a turnaround for 10 to 20 years.

Speaking at an Investment Week conference last week, the manager of £3.3bn Strategic Corporate Bond fund said investors have stopped trusting financials and spreads have widened substantially as a result. “Some fund managers think the banking sector is in a cyclical market and banks will eventually go back to normal, others are more sceptical like us. “We are not in a cyclical bear market – we are in a structural bear market. “This could last for a whole cycle of investment for the next 10 to 20 years until things change dramatically,” he said. The manager, whose fund has return...