REG - Lloyds Banking Group - 2024 Q3 Interim Management Statement
23/10/2024 07:00
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RNS Number : 2040J Lloyds Banking Group PLC 23 October 2024
Lloyds Banking Group plc
Q3 2024 Interim Management Statement
23 October 2024
RESULTS FOR THE NINE MONTHS ENDED 30 SEPTEMBER 2024
"The Group delivered a robust financial performance in the third quarter of
2024, with growth in income alongside continued cost discipline and strong
asset quality. Our performance allows us confidently to reaffirm our 2024
guidance.
As mentioned during our Half-Year 2024 results update, we are making good
progress on our strategy and remain on track to deliver higher, more
sustainable returns. As ever, we are guided by our purpose of Helping Britain
Prosper and continuing to provide support to our customers. The strength of
the Group's franchise, alongside our financial performance, enables us to
deliver for all stakeholders."
Charlie Nunn, Group Chief Executive
Robust financial performance, in line with expectations(1)
• Statutory profit after tax of £3.8 billion (nine months to 30 September
2023: £4.3 billion) with net income down 7 per cent on the prior year and
operating costs up 5 per cent (including the Bank of England Levy), partly
offset by a lower impairment charge
• Underlying net interest income of £9.6 billion, down 8 per cent with a
lower banking net interest margin of 2.94 per cent and average
interest-earning banking assets of £449.9 billion. Underlying net interest
income of £3.2 billion increased by 2 per cent in the third quarter, with a
banking net interest margin of 2.95 per cent, up from 2.93 per cent in the
second quarter
• Underlying other income of £4.2 billion, 9 per cent higher than the
prior year, driven by strengthening customer and market activity and the
benefit of strategic initiatives
• Operating lease depreciation of £994 million, up on the prior year
reflecting growth in the fleet size, depreciation of higher value vehicles and
declines in used electric car prices. The third quarter charge of £315
million was in line with expectations
• Operating costs of £7.0 billion, up 5 per cent, with cost efficiencies
helping to partially offset higher ongoing strategic investment, planned
accelerated severance charges and inflationary pressure, alongside c.£0.1
billion in the first quarter relating to the sector-wide change in the
charging approach for the Bank of England Levy
• Remediation costs of £124 million (first nine months of 2023:
£134 million), largely in relation to pre-existing programmes
• Underlying impairment charge of £273 million in the year to date and
asset quality ratio of 9 basis points. Excluding the impact of improvements to
the economic outlook, the asset quality ratio was 18 basis points. The
portfolio remains well-positioned with resilient credit performance
• Underlying loans and advances to customers increased by £7.3 billion in
the year to date, including £4.6 billion in the third quarter, to £457.0
billion. The growth in the year to date includes £7.4 billion across Retail,
while Commercial Banking remained broadly stable
• Customer deposits of £475.7 billion increased by £4.3 billion in the
year to date, with growth in Retail deposits of £6.6 billion, partly offset
by a reduction in Commercial Banking deposits of £2.1 billion. Customer
deposits continued to grow in the third quarter, with an increase of £1.0
billion
• Strong capital generation of 132 basis points in the year to date. CET1
ratio of 14.3 per cent, after 71 basis points for the interim ordinary
dividend paid and the foreseeable ordinary dividend accrual, significantly
above our ongoing target of c.13.0 per cent by 2026
• Risk-weighted assets of £223.3 billion up £4.2 billion in the period,
reflecting lending growth and other movements, partly offset by efficient
management of risk-weighted assets
• Tangible net assets per share of 52.5 pence, up from 50.8 pence at 31
December 2023
Reaffirming guidance for 2024
Based on our current macroeconomic assumptions, for 2024 the Group continues
to expect:
• Banking net interest margin of greater than 290 basis points
• Operating costs of c.£9.4 billion, including the c.£0.1 billion Bank
of England Levy
• Asset quality ratio to be less than 20 basis points
• Return on tangible equity of c.13 per cent
• Capital generation of c.175 basis points(2)
• Risk-weighted assets between £220 billion and £225 billion
• To pay down to a CET1 ratio of c.13.5 per cent
(1) See the basis of presentation on page 14.
(2) Excluding capital distributions. Inclusive of ordinary dividends
received from the Insurance business in February of the following year.
INCOME STATEMENT (UNDERLYING BASIS)(A) AND KEY BALANCE SHEET METRICS
Nine months ended Nine months ended Change Three months ended Three months ended Change
30 Sep 2024
30 Sep 2024
£m 30 Sep 2023 %
£m 30 Sep 2023 %
£m £m
Underlying net interest income 9,569 10,448 (8) 3,231 3,444 (6)
Underlying other income 4,164 3,837 9 1,430 1,299 10
Operating lease depreciation (994) (585) (70) (315) (229) (38)
Net income 12,739 13,700 (7) 4,346 4,514 (4)
Operating costs (6,992) (6,654) (5) (2,292) (2,241) (2)
Remediation (124) (134) 7 (29) (64) 55
Total costs (7,116) (6,788) (5) (2,321) (2,305) (1)
Underlying profit before impairment 5,623 6,912 (19) 2,025 2,209 (8)
Underlying impairment charge (273) (849) 68 (172) (187) 8
Underlying profit 5,350 6,063 (12) 1,853 2,022 (8)
Restructuring (21) (69) 70 (6) (44) 86
Volatility and other items (182) (266) 32 (24) (120) 80
Statutory profit before tax 5,147 5,728 (10) 1,823 1,858 (2)
Tax expense (1,370) (1,444) 5 (490) (438) (12)
Statutory profit after tax 3,777 4,284 (12) 1,333 1,420 (6)
Earnings per share 5.3p 5.9p (0.6)p 1.9p 2.0p (0.1)p
Banking net interest margin(A) 2.94% 3.15% (21)bp 2.95% 3.08% (13)bp
Average interest-earning banking assets(A) £449.9bn £453.5bn (1) £451.1bn £453.0bn
Cost:income ratio(A) 55.9% 49.5% 6.4pp 53.4% 51.1% 2.3pp
Asset quality ratio(A) 0.09% 0.25% (16)bp 0.15% 0.17% (2)bp
Return on tangible equity(A) 14.0% 16.6% (2.6)pp 15.2% 16.9% (1.7)pp
At 30 Sep At 30 Jun Change At 31 Dec Change
2024
2024
2023
% %
Underlying loans and advances to customers(A) £457.0bn £452.4bn 1 £449.7bn 2
Customer deposits £475.7bn £474.7bn £471.4bn 1
Loan to deposit ratio(A) 96% 95% 1pp 95% 1pp
CET1 ratio 14.3% 14.1% 0.2pp 14.6% (0.3)pp
Pro forma CET1 ratio(A,1) 14.3% 14.1% 0.2pp 13.7% 0.6pp
Total capital ratio 19.0% 18.7% 0.3pp 19.8% (0.8)pp
MREL ratio 32.2% 31.7% 0.5pp 31.9% 0.3pp
UK leverage ratio 5.5% 5.4% 0.1pp 5.8% (0.3)pp
Risk-weighted assets £223.3bn £222.0bn 1 £219.1bn 2
Wholesale funding £93.3bn £97.6bn (4) £98.7bn (5)
Liquidity coverage ratio(2) 144% 144% 142% 2pp
Net stable funding ratio(3) 129% 130% (1)pp 130% (1)pp
Tangible net assets per share(A) 52.5p 49.6p 2.9p 50.8p 1.7p
(A) See page 14.
(1 ) 31 December 2023 reflects both the full impact of the share buyback
in respect of 2023 and the ordinary dividend received from the Insurance
business in February 2024, but excludes the impact of the phased unwind of
IFRS 9 relief on 1 January 2024.
(2) The liquidity coverage ratio is calculated as a simple average of
month-end observations over the previous 12 months.
(3) The net stable funding ratio is calculated as a simple average of
month-end observations over the previous four quarter-ends.
(
)
QUARTERLY INFORMATION(A)
Quarter Quarter Change Quarter Quarter Quarter Quarter Quarter
ended ended % ended ended ended ended ended
30 Sep 30 Jun 31 Mar 31 Dec 30 Sep 30 Jun 31 Mar
2024 2024 2024 2023 2023 2023 2023
£m £m £m £m £m £m £m
Underlying net interest income 3,231 3,154 2 3,184 3,317 3,444 3,469 3,535
Underlying other income 1,430 1,394 3 1,340 1,286 1,299 1,281 1,257
Operating lease depreciation (315) (396) 20 (283) (371) (229) (216) (140)
Net income 4,346 4,152 5 4,241 4,232 4,514 4,534 4,652
Operating costs (2,292) (2,298) (2,402) (2,486) (2,241) (2,243) (2,170)
Remediation (29) (70) 59 (25) (541) (64) (51) (19)
Total costs (2,321) (2,368) 2 (2,427) (3,027) (2,305) (2,294) (2,189)
Underlying profit before impairment 2,025 1,784 14 1,814 1,205 2,209 2,240 2,463
Underlying impairment (charge) credit (172) (44) (57) 541 (187) (419) (243)
Underlying profit 1,853 1,740 6 1,757 1,746 2,022 1,821 2,220
Restructuring (6) (3) (12) (85) (44) (13) (12)
Volatility and other items (24) (41) 41 (117) 114 (120) (198) 52
Statutory profit before tax 1,823 1,696 7 1,628 1,775 1,858 1,610 2,260
Tax expense (490) (467) (5) (413) (541) (438) (387) (619)
Statutory profit after tax 1,333 1,229 8 1,215 1,234 1,420 1,223 1,641
Earnings per share 1.9p 1.7p 0.2p 1.7p 1.7p 2.0p 1.6p 2.3p
Banking net interest margin(A) 2.95% 2.93% 2bp 2.95% 2.98% 3.08% 3.14% 3.22%
Average interest-earning banking assets(A) £451.1bn £449.4bn £449.1bn £452.8bn £453.0bn £453.4bn £454.2bn
Cost:income ratio(A) 53.4% 57.0% (3.6)pp 57.2% 71.5% 51.1% 50.6% 47.1%
Asset quality ratio(A) 0.15% 0.05% 10bp 0.06% (0.47)% 0.17% 0.36% 0.22%
Return on tangible equity(A) 15.2% 13.6% 1.6pp 13.3% 13.9% 16.9% 13.6% 19.1%
At At Change At At At At At
30 Sep 30 Jun % 31 Mar 2024 31 Dec 30 Sep 2023 30 Jun 2023 31 Mar 2023
2024 2024 2023
Underlying loans and advances to customers(A,1) £457.0bn £452.4bn 1 £448.5bn £449.7bn £452.1bn £450.7bn £452.3bn
Customer deposits £475.7bn £474.7bn £469.2bn £471.4bn £470.3bn £469.8bn £473.1bn
Loan to deposit ratio(A) 96% 95% 1pp 96% 95% 96% 96% 96%
CET1 ratio 14.3% 14.1% 0.2pp 13.9% 14.6% 14.6% 14.2% 14.1%
Pro forma CET1 ratio(A,2) 14.3% 14.1% 0.2pp 13.9% 13.7% 14.6% 14.2% 14.1%
Total capital ratio 19.0% 18.7% 0.3pp 19.0% 19.8% 19.9% 19.7% 19.9%
MREL ratio 32.2% 31.7% 0.5pp 32.0% 31.9% 32.6% 31.0% 32.1%
UK leverage ratio 5.5% 5.4% 0.1pp 5.6% 5.8% 5.7% 5.7% 5.6%
Risk-weighted assets £223.3bn £222.0bn 1 £222.8bn £219.1bn £217.7bn £215.3bn £210.9bn
Wholesale funding £93.3bn £97.6bn (4) £99.9bn £98.7bn £108.5bn £103.5bn £101.1bn
Liquidity coverage ratio(3) 144% 144% 143% 142% 142% 142% 143%
Net stable funding ratio(4) 129% 130% (1)pp 130% 130% 130% 130% 129%
Tangible net assets per share(A) 52.5p 49.6p 2.9p 51.2p 50.8p 47.2p 45.7p 49.6p
(1) The increase between 31 March 2024 and 30 June 2024 is net of the impact
of the securitisation of £0.9 billion of legacy Retail mortgages in May 2024.
The reduction between 30 September 2023 and 31 December 2023 is net of the
impact of the securitisation of £2.7 billion of UK Retail unsecured loans.
(2 ) 31 December 2023 reflects both the full impact of the share buyback
in respect of 2023 and the ordinary dividend received from the Insurance
business in February 2024, but excludes the impact of the phased unwind of
IFRS 9 relief on 1 January 2024.
(3) The liquidity coverage ratio is calculated as a simple average of
month-end observations over the previous 12 months.
(4) The net stable funding ratio is calculated as a simple average of
month-end observations over the previous four quarter-ends.
BALANCE SHEET ANALYSIS
At 30 Sep 2024 At 30 Jun Change At 31 Dec Change
£bn
2024
2023
£bn %
£bn %
UK mortgages(1,2) 310.1 306.9 1 306.2 1
Credit cards 15.7 15.6 1 15.1 4
UK Retail unsecured loans 8.8 8.2 7 6.9 28
UK Motor Finance(3) 15.6 16.2 (4) 15.3 2
Overdrafts 1.1 1.0 10 1.1
Retail other(1,4) 17.3 17.2 1 16.6 4
Small and Medium Businesses 30.7 31.5 (3) 33.0 (7)
Corporate and Institutional Banking 57.2 56.6 1 55.6 3
Central Items(5) 0.5 (0.8) (0.1)
Underlying loans and advances to customers(A) 457.0 452.4 1 449.7 2
Retail current accounts 100.6 101.7 (1) 102.7 (2)
Retail savings accounts(6) 204.3 201.5 1 194.8 5
Wealth 10.1 10.1 10.9 (7)
Commercial Banking 160.7 161.2 162.8 (1)
Central Items - 0.2 0.2
Customer deposits 475.7 474.7 471.4 1
Total assets 900.8 892.9 1 881.5 2
Total liabilities 854.4 847.8 1 834.1 2
Ordinary shareholders' equity 40.3 39.0 3 40.3
Other equity instruments 5.9 5.9 6.9 (14)
Non-controlling interests 0.2 0.2 0.2
Total equity 46.4 45.1 3 47.4 (2)
Ordinary shares in issue, excluding own shares 61,419m 62,458m (2) 63,508m (3)
(1) From the first quarter of 2024, open mortgage book and closed mortgage
book loans and advances, previously presented separately, are reported
together as UK mortgages; Wealth loans and advances, previously reported
separately, are included within Retail other. The 31 December 2023
comparative is presented on a consistent basis.
(2) The increase between 31 December 2023 and 30 June 2024 is net of the
impact of the securitisation of £0.9 billion of legacy Retail mortgages in
May 2024.
(3) UK Motor Finance balances on an underlying basis(A) exclude a finance
lease gross up. See page 14.
(4) Within loans and advances, Retail other includes the European and Wealth
businesses.
(5) Central Items includes central fair value hedge accounting adjustments.
(6) From the first quarter of 2024, Retail relationship savings accounts and
Retail tactical savings accounts, previously reported separately, are reported
together as Retail savings accounts. The 31 December 2023 comparative is
presented on a consistent basis.
GROUP RESULTS - STATUTORY BASIS
The results below are prepared in accordance with the recognition and
measurement principles of International Financial Reporting Standards (IFRS).
The underlying results are shown on page 2.
Summary income statement Nine months Nine months ended Change
ended 30 Sep %
30 Sep 2023
2024 £m
£m
Net interest income 9,125 10,111 (10)
Other income 17,771 9,958 78
Total income 26,896 20,069 34
Net finance expense in respect of insurance and investment contracts (13,419) (6,167)
Total income, after net finance expense in respect of insurance and investment 13,477 13,902 (3)
contracts
Operating expenses (8,058) (7,331) (10)
Impairment charge (272) (843) 68
Profit before tax 5,147 5,728 (10)
Tax expense (1,370) (1,444) 5
Profit for the period 3,777 4,284 (12)
Profit attributable to ordinary shareholders 3,355 3,840 (13)
Ordinary shares in issue (weighted-average - basic) 62,948m 65,446m (4)
Basic earnings per share 5.3p 5.9p (0.6)p
Summary balance sheet At 30 Sep At 30 Jun Change At 31 Dec Change
2024 2024 % 2023 %
£m £m £m
Assets
Cash and balances at central banks 59,055 66,808 (12) 78,110 (24)
Financial assets at fair value through profit or loss 214,056 209,139 2 203,318 5
Derivative financial instruments 19,975 18,983 5 22,356 (11)
Financial assets at amortised cost 529,907 525,698 1 514,635 3
Financial assets at fair value through other comprehensive income 32,706 27,847 17 27,592 19
Other assets 45,143 44,452 2 35,442 27
Total assets 900,842 892,927 1 881,453 2
Liabilities
Deposits from banks 5,876 5,584 5 6,153 (5)
Customer deposits 475,737 474,693 471,396 1
Repurchase agreements at amortised cost 41,382 37,914 9 37,703 10
Financial liabilities at fair value through profit or loss 28,657 27,056 6 24,914 15
Derivative financial instruments 16,772 16,647 1 20,149 (17)
Debt securities in issue at amortised cost 70,805 74,760 (5) 75,592 (6)
Liabilities arising from insurance and participating investment contracts 120,961 125,007 (3) 120,123 1
Liabilities arising from non-participating investment contracts 49,725 48,280 3 44,978 11
Other liabilities 33,646 27,421 23 22,827 47
Subordinated liabilities 10,860 10,448 4 10,253 6
Total liabilities 854,421 847,810 1 834,088 2
Total equity 46,421 45,117 3 47,365 (2)
Total equity and liabilities 900,842 892,927 1 881,453 2
REVIEW OF PERFORMANCE(A)
Income statement (underlying basis)(A)
The Group's statutory profit before tax for the first nine months of 2024 was
£5,147 million, 10 per cent lower than the same period in 2023. This was
driven by lower net interest income and higher operating expenses, partly
offset by a lower impairment charge. Statutory profit before tax of
£1,823 million for the third quarter was up 7 per cent versus the second
quarter of 2024.
The Group's underlying profit was £5,350 million in the first nine months of
2024, a reduction of 12 per cent compared to £6,063 million in the prior
year. Underlying profit of £1,853 million in the third quarter was up 6 per
cent compared to the second quarter of 2024, with higher net income partly
offset by a higher impairment charge.
Net income of £12,739 million was down 7 per cent on the first nine months of
2023, driven by lower underlying net interest income and an increased charge
for operating lease depreciation. This was partly offset by higher underlying
other income. Net income in the third quarter of 2024 is up 5 per cent versus
the second quarter, with growth across underlying net interest income and
underlying other income.
Underlying net interest income of £9,569 million was down 8 per cent on the
first nine months of 2023, driven by a lower banking net interest margin of
2.94 per cent (nine months to 30 September 2023: 3.15 per cent), in line
with expectations. The lower margin reflected anticipated headwinds due to
deposit churn and asset margin compression, particularly in the mortgage book
as it refinances in a lower margin environment. These factors were partially
offset by benefits from higher structural hedge earnings as balances are
reinvested in the higher rate environment. Average interest-earning banking
assets in the first nine months of 2024 at £449.9 billion were slightly
lower (1 per cent) compared to the first nine months of 2023. This was due to
a modest reduction in the average mortgage book balance and a reduction in
average Commercial Banking lending, which included the effects of continued
repayments of government-backed lending in Small and Medium Businesses and
lower lending to banks. Underlying net interest income in the first nine
months included non-banking interest expense of £347 million (nine months to
30 September 2023: £231 million), increasing as a result of higher funding
costs and growth in the Group's non-banking businesses.
Underlying net interest income of £3,231 million in the third quarter of 2024
was higher than in the second quarter (three months to 30 June 2024: £3,154
million). Growth in structural hedge earnings more than offset the impact from
the continuation of headwinds in respect of deposit churn and asset margin
compression, resulting in a slight increase in banking net interest margin to
2.95 per cent in the third quarter (three months to 30 June 2024: 2.93 per
cent). Average interest earning banking assets were £451.1 billion, up on the
second quarter with growth in mortgage lending. These developments support the
delivery of full year 2024 guidance with the Group still expecting the banking
net interest margin for 2024 to be greater than 290 basis points and average
interest-earning banking assets to be greater than £450 billion.
The Group manages the risk to earnings and capital from movements in interest
rates by hedging the net liabilities which are stable or less sensitive to
movements in rates. At the end of the third quarter, the notional balance of
the sterling structural hedge was maintained at £242 billion (31 December
2023: £247 billion, 30 June 2024: £242 billion) with a weighted average
duration of approximately three-and-a-half years (31 December 2023:
approximately three-and-a-half years). This is in line with the balance at the
end of the second quarter, given increasing stability in deposit flows. The
Group generated £3.0 billion of total income from sterling structural hedge
balances in the first nine months of 2024, representing material growth over
the prior year (nine months to 30 September 2023: £2.5 billion). The Group
expects sterling structural hedge earnings in 2024 to be over £0.7 billion
higher than in 2023 (full year 2023: £3.4 billion).
Underlying other income in the first nine months of 2024 of £4,164 million
grew by 9 per cent compared to £3,837 million in the first nine months of
2023. Retail was up 12 per cent versus the first nine months of 2023,
primarily due to UK Motor Finance, reflecting growth following the acquisition
of Tusker in the first quarter of 2023, increased fleet size and higher
average rental value. Within Commercial Banking, 9 per cent growth was driven
by strong markets performance given strategic investment and higher levels of
client activity. Insurance, Pensions and Investments underlying other income
grew by 7 per cent compared to the first nine months of 2023, driven by
market share gains within general insurance alongside favourable market
returns, partly offset by the effects of the agreed sale (subject to
regulatory approval) of the in-force bulk annuity portfolio (with associated
income and costs for the period recognised within volatility and other items).
Excluding the in-force bulk annuity portfolio, Insurance, Pensions and
Investments was up 12 per cent. In Equity Investments and Central Items,
underlying other income in the year to date was adversely impacted by the
timing of exits in the Group's equity investment businesses. Compared to the
second quarter of 2024, underlying other income was 3 per cent higher in the
third quarter, primarily driven by growth in Retail and the Group's equity
investment businesses.
REVIEW OF PERFORMANCE (continued)
The Group delivered organic growth in assets under administration (AuA) in
Insurance, Pensions and Investments and Wealth (reported within Retail), with
combined £3.9 billion net new money in open book AuA over the first nine
months of 2024. In total, open book AuA stand at c.£197 billion at 30
September 2024.
Operating lease depreciation of £994 million increased compared to the prior
year (nine months to 30 September 2023: £585 million), largely as a result
of fleet growth, the depreciation of higher value vehicles and declines in
used electric car prices. This includes the c.£100 million additional charge
taken in the second quarter to reflect future expected residual values. The
charge in the third quarter was £315 million, consistent with expectations,
given used car prices have performed in line with assumptions since the second
quarter.
Total costs, including remediation, of £7,116 million were 5 per cent higher
than the prior year, with operating costs of £6,992 million up 5 per cent.
Operating costs include accelerated severance charges and c.£0.1 billion
relating to the sector-wide change in the charging approach for the Bank of
England Levy taken in the first quarter (excluding the Levy, operating costs
were up 4 per cent). The Group maintains its cost discipline with cost
efficiencies helping to offset higher ongoing strategic investment, planned
accelerated severance charges and inflationary pressure. The Group's
cost:income ratio for the first nine months of 2024 was 55.9 per cent
compared to 49.5 per cent in the prior year, and 53.4 per cent in the third
quarter. Operating costs in 2024 are still expected to be c.£9.4 billion,
including c.£0.1 billion for the new Bank of England Levy.
The Group recognised remediation costs of £124 million in the first nine
months (nine months to 30 September 2023: £134 million), largely in relation
to pre-existing programmes, with no further charges in respect of the FCA
review of historical motor finance commission arrangements. The FCA confirmed
in September 2024 its intention to set out next steps in its review in May
2025, including its assessment of the outcome of the Judicial Review and Court
of Appeal decisions involving other market participants; the Group will assess
the impact, if any, of these decisions.
Asset quality remains strong with resilient credit performance in the quarter.
Underlying impairment in the year to date was a charge of £273 million (nine
months to 30 September 2023: £849 million), resulting in an asset quality
ratio of 9 basis points. The charge reflects a £324 million multiple
economic scenarios (MES) credit (nine months to 30 September 2023: £69
million credit) from an improved economic outlook in the first half of the
year, notably house price growth and through changes to the severe downside
scenario methodology. The charge in the third quarter of £172 million
includes a one-off debt sale write back of £77 million in Retail. No MES
impact has been recognised for changes to the Group's macroeconomic
assumptions in the third quarter, of which only the outlook for house price
growth shows any meaningful revision.
The nine months to 30 September pre-updated MES charge of £597 million (nine
months to 30 September 2023: £918 million) is equivalent to an asset quality
ratio of 18 basis points. Compared to the prior year, the pre-updated MES
charge in the nine months to 30 September 2024 was lower, benefitting from
strong portfolio performance, the debt sale in the third quarter and a one-off
release in Commercial Banking from loss rates used in the model in the first
half. The Group continues to expect the asset quality ratio to be less than
20 basis points in 2024.
Restructuring costs for the first nine months of 2024 were £21 million (nine
months to 30 September 2023: £69 million) and include costs relating to the
integration of Embark and Tusker. Volatility and other items were a net loss
of £182 million for the year to date (nine months to 30 September 2023: net
loss of £266 million). This included £61 million for the amortisation of
purchased intangibles (nine months to 30 September 2023: £53 million) and
£79 million relating to fair value unwind (nine months to 30 September 2023:
£68 million). Alongside, negative market volatility of £41 million (nine
months to 30 September 2023: £145 million) was substantially driven by
longer-term rate rises in the period, causing negative insurance volatility,
partly offset by positive impacts from banking volatility. There was positive
market volatility of £24 million in the third quarter, in part driven by rate
reversals.
The return on tangible equity for the first nine months of 2024 was 14.0 per
cent (nine months to 30 September 2023: 16.6 per cent), with 15.2 per cent
in the third quarter. The Group continues to expect the return on tangible
equity for 2024 to be c.13 per cent.
Tangible net assets per share at 30 September 2024 was 52.5 pence, up 1.7
pence in the first nine months (31 December 2023: 50.8 pence). The increase
resulted from attributable profit and cash flow hedge reserve movements. This
was partly offset by capital distributions, foreign exchange impact on the
redemption of a US Dollar denominated AT1 capital instrument and a lower
pension surplus from negative market impacts. Tangible net assets per share
was up 2.9 pence in the third quarter, benefitting from attributable profit,
cash flow hedge reserve movements and the unwind of an accrual for the
ordinary share buyback in the second quarter, partly offset by capital
distributions. The Group continued the share buyback announced in February
2024, with c.2.8 billion shares repurchased as at 30 September 2024.
REVIEW OF PERFORMANCE (continued)
Balance sheet
Underlying loans and advances to customers increased by £7.3 billion in the
year to date to £457.0 billion. This included £3.9 billion growth in UK
mortgages (£4.8 billion growth excluding the impact of the securitisation of
£0.9 billion of legacy mortgages in the second quarter), £1.9 billion
growth in UK Retail unsecured loans due to organic balance growth and lower
repayments following a securitisation in the fourth quarter of 2023, alongside
a £0.6 billion increase in credit card balances and growth in other Retail
lending (principally in the European retail business). In Commercial Banking,
Small and Medium Business lending decreased by £2.3 billion, including
repayments of £1.2 billion of government-backed lending, partly offset by a
£1.6 billion increase in Corporate and Institutional Banking balances,
including infrastructure lending. Growth of £4.6 billion in underlying loans
and advances to customers in the third quarter was driven by balance increases
across Retail, including £3.2 billion in UK mortgages and £0.6 billion in
Corporate and Institutional Banking. This supports a positive trajectory for
average interest-earning banking assets in the fourth quarter of 2024, in line
with guidance for the full year.
The underlying expected credit loss (ECL) allowance reduced to £3.8 billion
(31 December 2023: £4.3 billion) in the period, reflecting releases from
improvements to the Group's base case scenario. The uplift from the base case
to probability-weighted ECL remains at £0.5 billion (31 December 2023:
£0.7 billion). The ECL was stable in the third quarter.
Customer deposits of £475.7 billion increased by £4.3 billion in the year
to date including £1.0 billion in the third quarter. Retail deposits were up
£6.6 billion in the first nine months with a combined increase of
£8.7 billion across Retail savings and Wealth, driven by inflows to limited
withdrawal and fixed term deposits, partly offset by a £2.1 billion reduction
in current account balances (significantly lower than the prior year, as
expected). Retail current account balances reduced by £1.1 billion in the
third quarter, lower than the £1.4 billion reduction in the second quarter
and slightly better than expectations. Modestly lower levels of deposit churn
were observed within savings and between savings and current accounts, versus
the second quarter as expected. Commercial Banking deposits reduced by
£2.1 billion in the first nine months, but were broadly stable in the third
quarter, reflecting an expected significant outflow, managing for value and
foreign exchange impacts, alongside growth in target sectors.
The Group has a large, high quality liquid asset portfolio held mainly in cash
and government bonds, with all assets hedged for interest rate risk. The
Group's liquid assets continue to significantly exceed regulatory requirements
and internal risk appetite, with a strong, stable liquidity coverage ratio of
144 per cent (31 December 2023: 142 per cent) and a strong net stable funding
ratio of 129 per cent (31 December 2023: 130 per cent). The loan to deposit
ratio of 96 per cent, broadly stable compared to 31 December 2023 and 30 June
2024, continues to reflect a robust funding and liquidity position.
Capital
The Group's CET1 capital ratio at 30 September 2024 was 14.3 per cent (31
December 2023: 13.7 per cent pro forma). Capital generation after regulatory
headwinds during the first nine months of the year was 132 basis points,
including 45 basis points in the third quarter. This reflects robust banking
build and the £200 million interim half-year dividend received from the
Insurance business, partially offset by risk-weighted asset increases and
other movements, including 15 basis points relating to the foreign exchange
translation loss following the US Dollar AT1 capital instrument redemption in
June. Regulatory headwinds of 9 basis points in the year to date reflect the
reduction in the transitional factor applied to IFRS 9 dynamic relief on 1
January 2024 and an adjustment for part of the impact of the Retail secured
CRD IV models. The impact of the interim ordinary dividend paid and the
foreseeable ordinary dividend accrual equated to 71 basis points. The Group
continues to expect capital generation in 2024 to be c.175 basis points.
As mentioned in the Group's 2023 Full Year Results, there will be no further
deficit contributions made to the Group's main defined benefit pension
schemes, fixed or variable, for this triennial period (to 31 December 2025).
Risk-weighted assets increased by £4.2 billion in the year to date to £223.3
billion at 30 September 2024 (31 December 2023: £219.1 billion) reflecting
the impact of lending growth, Retail secured CRD IV model updates and other
movements, partly offset by optimisation including capital efficient
securitisation activity. In the third quarter, risk-weighted assets increased
by £1.3 billion primarily driven by lending growth and CRD IV model updates,
again partly offset by optimisation activity. In the context of the Retail
secured CRD IV models, it is estimated that a £5 billion risk-weighted
asset increase will be required over 2024 to 2026, inclusive of the additional
£0.8 billion risk-weighted assets recognised in the first nine months of
2024. The total increase will be subject to final model outcomes. The Group's
risk-weighted assets guidance for 2024 remains unchanged at between
£220 billion and £225 billion.
REVIEW OF PERFORMANCE (continued)
The PRA recently published its second policy statement on implementing Basel
3.1 in the UK. The final regulations, which will introduce substantial
revisions to the approaches for calculating risk-weighted assets, will apply
from 1 January 2026. The Group now expects the impact of Basel 3.1
implementation to be modestly positive.
The PRA provided an update to the Group's Pillar 2A CET1 capital requirement
during the third quarter, with the requirement remaining at around 1.5 per
cent of risk-weighted assets. The Group's total regulatory CET1 capital
requirement remains at around 12 per cent. The Board's view of the ongoing
level of CET1 capital required to grow the business, meet current and future
regulatory requirements and cover economic and business uncertainties is
c.13.0 per cent. This includes a management buffer of around 1 per cent. In
order to manage risks and distributions in an orderly way, the Board expects
to pay down to the previous target of c.13.5 per cent by the end of 2024,
before progressing towards paying down to the current capital target of c.13.0
per cent by the end of 2026.
ADDITIONAL INFORMATION
Capital generation
Pro forma CET1 ratio as at 31 December 2023(1) 13.7%
Banking build (bps)(2) 166
Insurance dividend (bps) 10
Risk-weighted assets (bps) (23)
Other movements (bps)(3) (12)
Capital generation (bps) 141
Retail secured CRD IV model updates and phased unwind of IFRS 9 transitional (9)
relief (bps)
Capital generation (post CRD IV and transitional headwinds) (bps) 132
Ordinary dividend (bps) (71)
CET1 ratio as at 30 September 2024 14.3%
(1) 31 December 2023 reflects both the full impact of the share buyback in
respect of 2023 and the ordinary dividend received from the Insurance business
in February 2024, but excludes the impact of the phased unwind of IFRS 9
relief on 1 January 2024.
(2 ) Includes impairment charge.
(3) Includes share-based payments, market volatility and FX loss on USD AT1
redemption.
Underlying impairment(A)
Nine months ended Nine months ended Change Three months ended Three months ended Change
30 Sep 2024
£m 30 Sep 2023 % 30 Sep 2024 30 Sep %
£m £m 2023
£m
Charges (credits) pre-updated MES(1)
Retail 592 787 25 129 236 45
Commercial Banking 16 139 88 44 31 (42)
Other (11) (8) 38 (1) (6) (83)
597 918 35 172 261 34
Updated economic outlook
Retail (269) (30) - (71)
Commercial Banking (55) (39) 41 - (3)
(324) (69) - (74)
Underlying impairment charge(A) 273 849 68 172 187 8
Asset quality ratio(A) 0.09% 0.25% (16)bp 0.15% 0.17% (2)bp
Total underlying expected credit loss allowance (at end of period)(A) 3,838 5,389 (29)
(1) Impairment charges excluding the impact from updated economic outlook
taken each quarter.
(
)
ADDITIONAL INFORMATION (continued)
Loans and advances to customers and expected credit loss allowance (underlying
basis)(A)
At 30 September 2024 Stage 1 Stage 2 Stage 3 Total Stage 2 Stage 3
£m £m £m £m as % of as % of
total total
Loans and advances to customers
UK mortgages(1) 272,969 30,946 7,311 311,226 9.9 2.3
Credit cards 13,429 2,620 262 16,311 16.1 1.6
UK unsecured loans and overdrafts 8,839 1,374 173 10,386 13.2 1.7
UK Motor Finance(2) 13,484 2,314 119 15,917 14.5 0.7
Other 16,702 513 150 17,365 3.0 0.9
Retail 325,423 37,767 8,015 371,205 10.2 2.2
Small and Medium Businesses 26,393 3,430 1,303 31,126 11.0 4.2
Corporate and Institutional Banking 54,599 2,398 645 57,642 4.2 1.1
Commercial Banking 80,992 5,828 1,948 88,768 6.6 2.2
Equity Investments and Central Items(3) 532 - - 532 - -
Total gross lending 406,947 43,595 9,963 460,505 9.5 2.2
ECL allowance on drawn balances (773) (1,274) (1,488) (3,535)
Net balance sheet carrying value 406,174 42,321 8,475 456,970
Customer related ECL allowance (drawn and undrawn)
UK mortgages(1) 87 366 720 1,173
Credit cards 207 351 129 687
UK unsecured loans and overdrafts 170 242 111 523
UK Motor Finance(4) 169 105 68 342
Other 15 18 42 75
Retail 648 1,082 1,070 2,800
Small and Medium Businesses 138 190 160 488
Corporate and Institutional Banking 137 128 260 525
Commercial Banking 275 318 420 1,013
Equity Investments and Central Items - - - -
Total 923 1,400 1,490 3,813
Customer related ECL allowance (drawn and undrawn) as a percentage of loans
and advances to customers(5)
Stage 1 Stage 2 Stage 3 Total
%
%
%
%
UK mortgages - 1.2 9.8 0.4
Credit cards 1.5 13.4 49.2 4.2
UK unsecured loans and overdrafts 1.9 17.6 64.2 5.0
UK Motor Finance 1.3 4.5 57.1 2.1
Other 0.1 3.5 28.0 0.4
Retail 0.2 2.9 13.3 0.8
Small and Medium Businesses 0.5 5.5 16.5 1.6
Corporate and Institutional Banking 0.3 5.3 40.4 0.9
Commercial Banking 0.3 5.5 26.1 1.1
Equity Investments and Central Items - - - -
Total 0.2 3.2 15.5 0.8
(1 ) UK mortgages balances on an underlying basis(A) exclude the impact
of the HBOS acquisition-related adjustments.
(2) UK Motor Finance balances on an underlying basis(A) exclude a finance
lease gross up. See page 14.
(3) Contains central fair value hedge accounting adjustments.
(4) UK Motor Finance includes £170 million relating to provisions against
residual values of vehicles subject to finance leases.
(5) Stage 3 and Total exclude loans in recoveries in Small and Medium
Businesses of £336 million and Corporate and Institutional Banking of £1
million.
(
)
ADDITIONAL INFORMATION (continued)
Total ECL allowance by scenario (underlying basis)(A)
The table below shows the Group's ECL for the probability-weighted, upside,
base case, downside and severe downside scenarios, the severe downside
scenario incorporating adjustments made to Consumer Price Index (CPI)
inflation and UK Bank Rate paths. No MES impact has been recognised in the ECL
amounts below for changes to the Group's macroeconomic assumptions in the
third quarter, of which only the outlook for house price growth shows any
meaningful revision.
Underlying basis(A) Probability- Upside Base case Downside Severe
weighted £m £m £m downside
£m £m
At 30 September 2024 3,838 2,806 3,380 4,320 6,865
At 30 June 2024 3,847 2,804 3,380 4,331 6,926
At 31 December 2023 4,337 2,925 3,666 4,714 9,455
Base case and MES economic assumptions
The Group's base case scenario is for a slow expansion in GDP and a modest
rise in the unemployment rate alongside small gains in residential and
commercial property prices. Following a reduction in inflationary pressures,
cuts in UK Bank Rate are expected to continue during 2024 and 2025. Risks
around this base case economic view lie in both directions and are largely
captured by the generation of alternative economic scenarios.
The Group has taken into account the latest available information at the
reporting date in defining its base case scenario and generating alternative
economic scenarios. The scenarios include forecasts for key variables as of
the third quarter of 2024. Actuals for this period, or restatements of past
data, may have since emerged prior to publication and have not been included,
including specifically in the Quarterly National Accounts release of 30
September 2024. The Group's approach to generating alternative economic
scenarios is set out in detail in note 24 to the financial statements for the
year ended 31 December 2023. For September 2024, the Group continues to judge
it appropriate to include a non-modelled severe downside scenario for ECL
calculations as explained in note 14 of the Group's 2024 Half-Year news
release.
UK economic assumptions - base case scenario by quarter
Key quarterly assumptions made by the Group in the base case scenario are
shown below. Gross domestic product is presented quarter-on-quarter. House
price growth, commercial real estate price growth and CPI inflation are
presented year-on-year, i.e. from the equivalent quarter in the previous year.
Unemployment rate and UK Bank Rate are presented as at the end of each
quarter.
At 30 September 2024 First Second Third Fourth First Second Third Fourth
quarter quarter quarter quarter quarter quarter quarter quarter
2024 2024 2024 2024 2025 2025 2025 2025
% % % % % % % %
Gross domestic product growth 0.7 0.6 0.3 0.3 0.3 0.3 0.4 0.4
Unemployment rate 4.3 4.2 4.3 4.5 4.6 4.7 4.8 4.8
House price growth 0.4 1.8 5.3 3.1 3.2 3.6 2.4 2.0
Commercial real estate price growth (5.3) (4.7) (2.5) 0.3 1.4 1.9 1.6 1.7
UK Bank Rate 5.25 5.25 5.00 4.75 4.50 4.25 4.00 4.00
CPI inflation 3.5 2.1 2.1 2.7 2.4 2.9 2.7 2.3
UK economic assumptions - scenarios by year
Key annual assumptions made by the Group are shown below. Gross domestic
product and CPI inflation are presented as an annual change, house price
growth and commercial real estate price growth are presented as the growth in
the respective indices within the period. Unemployment rate and UK Bank Rate
are averages for the period.
ADDITIONAL INFORMATION (continued)
Base case and MES economic assumptions (continued)
At 30 September 2024 2024 2025 2026 2027 2028 2024-2028
% % % % % average
%
Upside
Gross domestic product growth 1.2 2.4 1.9 1.5 1.4 1.7
Unemployment rate 4.2 3.3 2.8 2.7 2.8 3.1
House price growth 3.5 4.6 7.1 6.4 5.1 5.3
Commercial real estate price growth 1.6 9.0 4.2 1.8 0.7 3.4
UK Bank Rate 5.06 5.08 5.16 5.34 5.58 5.24
CPI inflation 2.6 2.7 2.4 2.8 2.8 2.7
Base case
Gross domestic product growth 1.1 1.3 1.5 1.5 1.5 1.4
Unemployment rate 4.3 4.7 4.7 4.5 4.5 4.5
House price growth 3.1 2.0 1.0 1.5 2.1 2.0
Commercial real estate price growth 0.3 1.7 2.1 0.7 0.3 1.0
UK Bank Rate 5.06 4.19 3.63 3.50 3.50 3.98
CPI inflation 2.6 2.6 2.1 2.2 2.1 2.3
Downside
Gross domestic product growth 1.0 (0.3) 0.4 1.3 1.5 0.8
Unemployment rate 4.4 6.5 7.3 7.3 7.1 6.5
House price growth 2.9 (0.2) (6.1) (5.8) (2.9) (2.5)
Commercial real estate price growth (0.7) (6.2) (1.7) (1.9) (1.9) (2.5)
UK Bank Rate 5.06 3.11 1.48 0.96 0.65 2.25
CPI inflation 2.6 2.6 1.9 1.5 1.1 2.0
Severe downside
Gross domestic product growth 0.9 (2.0) (0.1) 1.1 1.4 0.2
Unemployment rate 4.6 8.6 9.9 9.9 9.7 8.5
House price growth 2.3 (2.5) (13.5) (12.6) (8.3) (7.1)
Commercial real estate price growth (2.7) (16.5) (6.5) (6.5) (5.1) (7.6)
UK Bank Rate - modelled 5.06 1.83 0.23 0.06 0.02 1.44
UK Bank Rate - adjusted(1) 5.13 3.67 2.55 2.16 1.88 3.08
CPI inflation - modelled 2.6 2.6 1.5 0.7 0.1 1.5
CPI inflation - adjusted(1) 2.6 3.5 1.8 1.3 0.9 2.0
Probability-weighted
Gross domestic product growth 1.1 0.8 1.1 1.4 1.4 1.2
Unemployment rate 4.3 5.2 5.4 5.3 5.3 5.1
House price growth 3.1 1.7 (0.7) (0.6) 0.5 0.8
Commercial real estate price growth 0.1 (0.3) 0.7 (0.5) (0.8) (0.1)
UK Bank Rate - modelled 5.06 3.90 3.10 2.95 2.92 3.59
UK Bank Rate - adjusted(1) 5.07 4.08 3.33 3.15 3.11 3.75
CPI inflation - modelled 2.6 2.6 2.0 2.0 1.8 2.2
CPI inflation - adjusted(1) 2.6 2.7 2.1 2.1 1.9 2.3
(1) The adjustment to UK Bank Rate and CPI inflation in the severe downside
is considered to better reflect the risks to the Group's base case view in an
economic environment where the risks of supply and demand shocks are seen as
more balanced.
( )
ALTERNATIVE PERFORMANCE MEASURES
The statutory results are supplemented with a number of metrics that are used
throughout the banking and insurance industries on an underlying basis. A
description of these measures and their calculation, which remain materially
unchanged since the year-end, is set out on pages 27 to 32 of the Group's 2023
Full Year Results News Release.
Nine months ended Nine months ended
30 Sep 2024 30 Sep 2023
Banking net interest margin(A)
Underlying net interest income (£m) 9,569 10,448
Remove non-banking underlying net interest expense (£m) 347 231
Banking underlying net interest income (£m) 9,916 10,679
Loans and advances to customers (£bn) 457.9 452.1
Remove finance lease gross up(1) (£bn) (0.9) -
Underlying loans and advances to customers(A) (£bn) 457.0 452.1
Add back:
Expected credit loss allowance (drawn) (£bn) 3.3 4.7
Acquisition related fair value adjustments (£bn) 0.2 0.3
Underlying gross loans and advances to customers (£bn) 460.5 457.1
Adjustment for non-banking and other items:
Fee-based loans and advances (£bn) (10.1) (8.6)
Other (£bn) 2.8 6.0
Interest-earning banking assets (£bn) 453.2 454.5
Averaging (£bn) (3.3) (1.0)
Average interest-earning banking assets(A) (£bn) 449.9 453.5
Banking net interest margin(A) 2.94% 3.15%
(1) The finance lease gross up represents a statutory accounting adjustment
required under IFRS 9 to recognise a continuing involvement asset following
the partial derecognition of a component of the Group's finance lease book via
a securitisation in the third quarter of 2024.
Nine months ended Nine months ended
30 Sep 2024 30 Sep 2023
Return on tangible equity(A)
Profit attributable to ordinary shareholders (£m) 3,355 3,840
Average ordinary shareholders' equity (£bn) 40.0 38.5
Remove average goodwill and other intangible assets (£bn) (8.0) (7.6)
Average tangible equity (£bn) 32.0 30.9
Return on tangible equity(A) 14.0% 16.6%
BASIS OF PRESENTATION
This release covers the results of Lloyds Banking Group plc together with its
subsidiaries (the Group) for the nine months ended 30 September 2024. Unless
otherwise stated, income statement commentaries throughout this document
compare the nine months ended 30 September 2024 to the nine months ended 30
September 2023 and the balance sheet analysis compares the Group balance sheet
as at 30 September 2024 to the Group balance sheet as at 31 December 2023.
The Group uses a number of alternative performance measures, including
underlying profit, in the discussion of its business performance and financial
position. These measures are labelled with a superscript 'A' throughout this
document. Further information on these measures is set out above. Unless
otherwise stated, commentary on page 1 is given on an underlying basis. The
Group's Q3 2024 Interim Pillar 3 Disclosures can be found at:
www.lloydsbankinggroup.com/investors/financial-downloads.html.
FORWARD-LOOKING STATEMENTS
This document contains certain forward-looking statements within the meaning
of Section 21E of the US Securities Exchange Act of 1934, as amended, and
section 27A of the US Securities Act of 1933, as amended, with respect to the
business, strategy, plans and/or results of Lloyds Banking Group plc together
with its subsidiaries (the Group) and its current goals and expectations.
Statements that are not historical or current facts, including statements
about the Group's or its directors' and/or management's beliefs and
expectations, are forward-looking statements. Words such as, without
limitation, 'believes', 'achieves', 'anticipates', 'estimates', 'expects',
'targets', 'should', 'intends', 'aims', 'projects', 'plans', 'potential',
'will', 'would', 'could', 'considered', 'likely', 'may', 'seek', 'estimate',
'probability', 'goal', 'objective', 'deliver', 'endeavour', 'prospects',
'optimistic' and similar expressions or variations on these expressions are
intended to identify forward-looking statements. These statements concern or
may affect future matters, including but not limited to: projections or
expectations of the Group's future financial position, including profit
attributable to shareholders, provisions, economic profit, dividends, capital
structure, portfolios, net interest margin, capital ratios, liquidity,
risk-weighted assets (RWAs), expenditures or any other financial items or
ratios; litigation, regulatory and governmental investigations; the Group's
future financial performance; the level and extent of future impairments and
write-downs; the Group's ESG targets and/or commitments; statements of plans,
objectives or goals of the Group or its management and other statements that
are not historical fact and statements of assumptions underlying such
statements. By their nature, forward-looking statements involve risk and
uncertainty because they relate to events and depend upon circumstances that
will or may occur in the future. Factors that could cause actual business,
strategy, targets, plans and/or results (including but not limited to the
payment of dividends) to differ materially from forward-looking statements
include, but are not limited to: general economic and business conditions in
the UK and internationally; acts of hostility or terrorism and responses to
those acts, or other such events; geopolitical unpredictability; the war
between Russia and Ukraine; the conflicts in the Middle East; the tensions
between China and Taiwan; political instability including as a result of any
UK general election; market related risks, trends and developments; changes in
client and consumer behaviour and demand; exposure to counterparty risk; the
ability to access sufficient sources of capital, liquidity and funding when
required; changes to the Group's credit ratings; fluctuations in interest
rates, inflation, exchange rates, stock markets and currencies; volatility in
credit markets; volatility in the price of the Group's securities; tightening
of monetary policy in jurisdictions in which the Group operates; natural
pandemic and other disasters; risks concerning borrower and counterparty
credit quality; risks affecting insurance business and defined benefit pension
schemes; changes in laws, regulations, practices and accounting standards or
taxation; changes to regulatory capital or liquidity requirements and similar
contingencies; the policies and actions of governmental or regulatory
authorities or courts together with any resulting impact on the future
structure of the Group; risks associated with the Group's compliance with a
wide range of laws and regulations; assessment related to resolution planning
requirements; risks related to regulatory actions which may be taken in the
event of a bank or Group failure; exposure to legal, regulatory or competition
proceedings, investigations or complaints; failure to comply with anti-money
laundering, counter terrorist financing, anti-bribery and sanctions
regulations; failure to prevent or detect any illegal or improper activities;
operational risks including risks as a result of the failure of third party
suppliers; conduct risk; technological changes and risks to the security of IT
and operational infrastructure, systems, data and information resulting from
increased threat of cyber and other attacks; technological failure; inadequate
or failed internal or external processes or systems; risks relating to ESG
matters, such as climate change (and achieving climate change ambitions) and
decarbonisation, including the Group's ability along with the government and
other stakeholders to measure, manage and mitigate the impacts of climate
change effectively, and human rights issues; the impact of competitive
conditions; failure to attract, retain and develop high calibre talent; the
ability to achieve strategic objectives; the ability to derive cost savings
and other benefits including, but without limitation, as a result of any
acquisitions, disposals and other strategic transactions; inability to capture
accurately the expected value from acquisitions; assumptions and estimates
that form the basis of the Group's financial statements; and potential changes
in dividend policy. A number of these influences and factors are beyond the
Group's control. Please refer to the latest Annual Report on Form 20-F filed
by Lloyds Banking Group plc with the US Securities and Exchange Commission
(the SEC), which is available on the SEC's website at www.sec.gov, for a
discussion of certain factors and risks. Lloyds Banking Group plc may also
make or disclose written and/or oral forward-looking statements in other
written materials and in oral statements made by the directors, officers or
employees of Lloyds Banking Group plc to third parties, including financial
analysts. Except as required by any applicable law or regulation, the
forward-looking statements contained in this document are made as of today's
date, and the Group expressly disclaims any obligation or undertaking to
release publicly any updates or revisions to any forward-looking statements
contained in this document whether as a result of new information, future
events or otherwise. The information, statements and opinions contained in
this document do not constitute a public offer under any applicable law or an
offer to sell any securities or financial instruments or any advice or
recommendation with respect to such securities or financial instruments.
CONTACTS
For further information please contact:
INVESTORS AND ANALYSTS
Douglas Radcliffe
Group Investor Relations Director
020 7356 1571
douglas.radcliffe@lloydsbanking.com
Nora Thoden
Director of Investor Relations - ESG
020 7356 2334
nora.thoden@lloydsbanking.com
Tom Grantham
Investor Relations Senior Manager
07851 440 091
thomas.grantham@lloydsbanking.com
Sarah Robson
Investor Relations Senior Manager
07494 513 983
sarah.robson2@lloydsbanking.com
CORPORATE AFFAIRS
Grant Ringshaw
External Relations Director
020 7356 2362
grant.ringshaw@lloydsbanking.com
Matt Smith
Head of Media Relations
07788 352 487
matt.smith@lloydsbanking.com
Copies of this News Release may be obtained from:
Investor Relations, Lloyds Banking Group plc, 25 Gresham Street, London EC2V
7HN
The statement can also be found on the Group's website -
www.lloydsbankinggroup.com
Registered office: Lloyds Banking Group plc, The Mound, Edinburgh, EH1 1YZ
Registered in Scotland No. SC095000
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