UK: Lloyds Bank profits rise to £863million

Profits are up at Lloyds Banking Group Profits are up at Lloyds Banking Group

Thursday, July 31, 2014
10:00 AM

Lloyds Banking Group has posted a half-year profit of £863 million, despite setting aside another £600 million to cover mis-sold payment protection insurance (PPI).

To send a link to this page to a friend, you must be logged in.

The group, which is 25% owned by the taxpayer, said it “substantially improved” its financial performance in the six months to June 30, with profits excluding the PPI charge up 32% to £3.8 billion.

The overall profit of £863 million came despite a hit of £1.1 billion to cover legacy issues, including its £217 million fine this week for rate-rigging which included ripping off the Bank of England over its financial life-support scheme.

The group’s £600 million increase in its provision for expected PPI costs in the second quarter brought the running total to £10.4 billion, of which more than £2 billion relates to anticipated administrative costs.

Lloyds is forecasting a slower decline in complaints levels, with the increased provision accounting for an extra 155,000 complaints.

Lloyds shares opened 1% higher after the group upgraded its net interest margin - a key measure of profitability - to around 2.45% for the full-year.

It added that it remains on track to restart dividend payments in the next year, subject to the approval of the Prudential Regulatory Authority.

Chief executive Antonio Horta-Osorio plans to issue an update on his proposals for the group in the autumn.

He said: “It has been a successful first half for the group. With our initial three-year strategic plan now substantially complete, we are progressing our plans for how we will take the group forward into 2015 and beyond, and take advantages of the new growth phase of the UK economy.”

The Halifax owner said it provided one in four of all mortgages to first-time buyers in the first half, with lending of £5.7 billion to more than 43,000 customers.

Overall new mortgage lending was £20 billion - £6 billion higher than in the first half of 2013 - while it said it has lent almost £1 billion through the Government’s Help to Buy mortgage guarantee scheme.

The company added that around 10% of its new residential mortgages were written at a loan-to-income ratio at or greater than a 4.5 multiple.

Royal Bank of Scotland, which is 80% owned by the taxpayer, said last week that it nearly doubled underlying profits to £2.65 billion in the first half of the year, despite an extra £250 million hit for mis-selling financial products.

0 comments

Comments

Welcome , please leave your message below.

Optional - JPG files only
Optional - MP3 files only
Optional - 3GP, AVI, MOV, MPG or WMV files
Comments

Please log in to leave a comment and share your views with other East Anglian Daily Times visitors.

We enable people to post comments with the aim of encouraging open debate.

Only people who register and sign up to our terms and conditions can post comments. These terms and conditions explain our house rules and legal guidelines.

Comments are not edited by East Anglian Daily Times staff prior to publication but may be automatically filtered.

If you have a complaint about a comment please contact us by clicking on the Report This Comment button next to the comment.

Forgotten your password?

Not a member yet?

Register to create your own unique East Anglian Daily Times account for free.

Signing up is free, quick and easy and offers you the chance to add comments, personalise the site with local information picked just for you, and more.

Sign up now

ADVERTISEMENT

ADVERTISEMENT

loading...

ADVERTISEMENT

ADVERTISEMENT