LLOYDS BANKING GROUP PLC DGAP-News: Lloyds Banking Group PLC / Key word(s): Quarterly / Interim Statement Lloyds Banking Group PLC: 2021 Q3 Interim Management Statement 2021-10-28 / 09:45 The issuer is solely responsible for the content of this announcement.
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Lloyds Banking Group plc
Q3 2021 Interim Management Statement
28 October 2021
RESULTS FOR THE NINE MONTHS ENDED 30 SEPTEMBER 2021 "I am delighted to be introducing my first set of results as CEO of Lloyds Banking Group. It is very clear to me that the Group is a truly purpose-driven organisation with a real customer focus. The Group has a great franchise, an excellent digital proposition and a real depth of talent. I have been impressed with the Group's ability to Help Britain Recover from the pandemic, its commitment to sustainability and diversity, as well as its strong risk stewardship. Building on the strengths of the Group and its achievements in recent years, there are clearly significant opportunities for Lloyds Banking Group to further develop its platforms and capabilities and grow through disciplined investment, empowering colleagues, enhancing collaboration and increasing agility across the Group. This can be built on the foundation strengths of customer service, distribution, and cost management. As we move into the final quarter of 2021, the Board, Group Executive Committee and I are developing the next evolution of our strategy and longer-term priorities. I look forward to working with all colleagues across the Group in continuing to build a resilient, stable Lloyds Banking Group and deliver sustainable, long-term returns for our shareholders, whilst meeting the needs of broader stakeholders." Charlie Nunn, Group Chief Executive
HIGHLIGHTS FOR THE NINE MONTHS ENDED 30 SEPTEMBER 2021
Continued business momentum and solid financial performance
* Strong progress on Strategic Review 2021 priorities, including an all channel net promoter score and
mobile app net promoter score above 2021 targets, improved capabilities in Markets products and a 12
per cent increase in new clients using the Group's improved merchant services proposition
* Statutory profit before tax of GBP5.9 billion (GBP2.0 billion in the quarter) and underlying profit of
GBP6.3 billion (GBP2.2 billion in the quarter), both up significantly compared to the first nine months of
2020
* Solid net income of GBP11.6 billion, up 8 per cent (up 20 per cent compared to the third quarter of
2020), benefiting from increased average interest-earning assets of GBP443.0 billion, a banking net
interest margin of 2.52 per cent and other income of GBP3.8 billion, alongside a reduction in operating
lease depreciation
* Sustained cost discipline with operating costs of GBP5.6 billion, up 1 per cent compared to the first
nine months of 2020, including the impact of rebuilding variable pay. Remediation charge of GBP100
million in the third quarter
* Asset quality remains strong. Net impairment credit of GBP740 million, including a net credit of GBP84
million in the third quarter, based upon improvements to the macroeconomic outlook for the UK, combined
with robust credit performance. Management judgements in respect of coronavirus of c.GBP1.2 billion
retained
Balance sheet and capital strength further enhanced
* Loans and advances at GBP450.5 billion, up GBP10.3 billion (GBP2.8 billion in the third quarter), driven by
strong growth of GBP15.3 billion in the open mortgage book (GBP2.7 billion in the third quarter)
* Customer deposits of GBP479.1 billion, up GBP28.4 billion (GBP4.7 billion in the quarter), with continued
inflows to the Group's trusted brands, including Retail current accounts up GBP12.2 billion. Resulting
loan to deposit ratio of 94 per cent provides a strong liquidity position and significant potential to
lend into recovery
* Strong capital build of 159 basis points. CET1 ratio of 17.2 per cent after dividend accrual,
significantly ahead of the ongoing target of c.12.5 per cent, plus a c.1 per cent management buffer 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 modestly above 250 basis points
- Operating costs expected to be c.GBP7.6 billion
- Impairment now expected to be a net credit for the year
- Return on tangible equity now expected to be over 10 per cent, excluding the c.2.5 percentage point
benefit from tax rate changes
- Risk-weighted assets in 2021 expected to be below GBP200 billion
* The Group continues to target a return on tangible equity in excess of its cost of equity in the
medium term
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2021-10-28 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. The DGAP Distribution Services include Regulatory Announcements, Financial/Corporate News and Press Releases. Archive at www.dgap.de
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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: 1244285
End of News DGAP News Service
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October 28, 2021 03:45 ET (07:45 GMT)
