Lloyds Bank Reports Fall in Profits
Lloyds Banking Group has reported a fall in first quarter profits after what it called a “robust” performance. Underlying profits for the January to March period dipped 6% to £2.05bn for the first quarter of the year, down from £2.18bn a year earlier.
Chief executive Antonio Horta-Osorio said the bank had “continued to make good progress”.
Statutory pre-tax profits nearly halved to £654m, mainly due to a £790m charge the bank took for buying back bonds. No further provisions were made for PPI compensation, where complaint levels were around 8,500 per week on average, broadly in line with expectations.
Lloyds was rescued by the government during the financial crisis, which left the state holding a 43% stake in the bank.
The government has been steadily reducing its stake and now holds less than 10%. In January, the chancellor postponed the sale of the government’s final stake in Lloyds, blaming the turmoil in financial markets.
Mr Horta-Osorio has cut thousands of jobs and said Thursday’s results reflected the bank’s “simple, low risk business model.”
Lloyds, which is the largest retail bank in Britain, said total income fell 1% to £4.38bn as higher revenue from its retail bank was offset by lower income from its insurance division.
On Wednesday, Barclays reported a 25% drop in profits for the first quarter of the year. It had set expectations low, warning it had been hit by the same headwinds that have hit profits across most of the world’s biggest banks.