BackLloyds first-half profit rises 32% as bad loan impairments fall
Underlying pre-tax profit rose to 3.8 billion from 2.9 billion a year ago
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London: Lloyds Banking Group Plc, Britain’s largest mortgage lender, said first-half profit rose 32%, surpassing estimates, as the share of bad loans declined.
Underlying pre-tax profit rose to £3.8 billion ($6.5 billion) from £2.9 billion in the year-earlier period, the bank said in a statement on Thursday. That beat the £3.6 billion average estimate of six analysts surveyed by Bloomberg News. Impairments for souring loans dropped 58% to £758 million.
Lloyds also said it expects statutory pre-tax profit for the full year to be significantly ahead of the first half. Chief executive officer Antonio Horta-Osorio is seeking to resume dividends to help smooth the 25% government-owned bank’s return to full private ownership. While the lender has benefited from a UK housing boom and a strengthening economy, it was fined £226 million on 28 July for manipulating benchmark interest rates, the fifth-largest among seven firms settling with regulators.
“We continue to be well placed to support and benefit from the strengthening UK economic recovery and to deliver strong and sustainable returns to shareholders," Horta-Osorio, 50, said in the statement. He said the bank will apply to the Prudential Regulation Authority in the second half of 2014 to restart dividend payments.
The stock has declined 3.1% this year to 76.41 pence, above the 61 pence price at which the government says it breaks even on its £20 billion rescue in 2008. The government sold a £4.2 billion stake in Lloyds in March.
Royal Bank of Scotland Group Plc, the largest state-owned British lender, said on 25 July it expects first-half pre-tax profit to rise to £2.65 billion from £1.37 pounds a year earlier. Barclays Plc on Wednesday reported a return to profit in the second quarter from a loss. Bloomberg
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