DGAP-News: Lloyds Banking Group PLC / Key word(s): Half Year Results
Lloyds Banking Group PLC: 2021 Half-Year Results
2021-07-29 / 11:20
The issuer is solely responsible for the content of this announcement.
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Lloyds Banking Group plc
2021 Half-Year Results
29 July 2021
RESULTS FOR THE HALF-YEAR
"During the first six months of 2021, the Group has delivered a solid financial performance with continued business
momentum, bolstered by an improved macroeconomic outlook for the UK. While we are seeing clear progress in the vaccine
roll out and emergence from lockdown restrictions, the coronavirus pandemic continues to have a significant impact on
the people, businesses and communities of the UK. In this context, the Group remains committed to Helping Britain
Recover from the pandemic and delivering for all stakeholders."
William Chalmers
Interim Group Chief Executive
Solid financial performance with continued business momentum, bolstered by improved macroeconomic outlook
. Good progress on Strategic Review 2021 priorities, including record customer satisfaction scores, improved
capabilities in Markets products and a leading payments card spend market share
. Announced today the acquisition of Embark, a fast growing investment and retirement platform business. Embark
enhances our capabilities to address the attractive mass market and self-directed Wealth segment, completing the
Group's Wealth proposition. Embark will also enable the Group to re-platform its pensions and retirement
proposition, significantly strengthening its offering in Retirement, an important growth market
. Statutory profit before tax of GBP3.9 billion, increased significantly on first half of 2020, benefiting from solid
business momentum and a net impairment credit in the period
. Net income of GBP7.6 billion, up 2 per cent, with increased average interest-earning assets at GBP441 billion, a strong
banking net interest margin of 2.50 per cent and other income of GBP2.4 billion, alongside a reduction in operating
lease depreciation
. Sustained cost discipline with operating costs of GBP3.7 billion, including the impact of rebuilding variable pay in
the context of stronger than expected financial performance
. Remediation charge of GBP425 million, materially driven by the GBP91 million regulatory fine relating to the
communication of historical insurance renewals, GBP150 million of redress and operational costs for HBOS Reading, and
charges in relation to other ongoing legacy programmes
. Net impairment credit of GBP656 million, including GBP333 million in the second quarter, as a result of an GBP837 million
release driven by improvements to the macroeconomic outlook for the UK, combined with robust credit performance.
Management judgements in respect of coronavirus retained, now c.GBP1.2 billion
Balance sheet and capital strength further enhanced
. Loans and advances at GBP447.7 billion, up GBP7.5 billion in the period, driven by strong growth of GBP12.6 billion in
the open mortgage book
. Customer deposits of GBP474.4 billion up GBP23.7 billion in the period, with continued inflows into the Group's trusted
brands, including Retail current accounts which were up GBP9.9 billion in the period. Resulting loan to deposit ratio
of 94 per cent, continues to provide a strong liquidity position and significant potential to lend into recovery
. Strong capital build of 93 basis points in the first half prior to the interim ordinary dividend. Reintroduced a
progressive and sustainable ordinary dividend policy, with an interim ordinary dividend of 0.67 pence per share
. CET1 ratio of 16.7 per cent after dividend accrual, significantly ahead of both the ongoing target of c.12.5 per
cent, plus a management buffer of c.1 per cent and regulatory requirement of c.11 per cent
Outlook
- Given our solid financial performance and the improved UK macroeconomic outlook, the Group is enhancing its guidance
for 2021. Based on the Group's current macroeconomic assumptions:
. Net interest margin now expected to be around 250 basis points
. Operating costs now expected to be c.GBP7.6 billion
. Net asset quality ratio now expected to be below 10 basis points
. Return on tangible equity now expected to be c.10 per cent, excluding the c.2.5 percentage point benefit from
tax rate changes
. Risk-weighted assets in 2021 now expected to be below GBP200 billion
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2021-07-29 Dissemination of a Corporate News, transmitted by DGAP - a service of EQS Group AG.
The issuer is solely responsible for the content of this announcement.
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Language: English
Company: Lloyds Banking Group PLC
Gresham Street
EC2V 7HN London
United Kingdom
Phone: 020 7626 1500
Internet: www.lloydsbankinggroup.com
ISIN: GB0008706128
WKN: 871784
Listed: Regulated Unofficial Market in Berlin, Dusseldorf, Frankfurt, Hamburg, Hanover, Munich, Stuttgart,
Tradegate Exchange; London, BX, SIX
EQS News ID: 1222644
End of News DGAP News Service
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1222644 2021-07-29
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(END) Dow Jones Newswires
July 29, 2021 05:20 ET (09:20 GMT)