Bank lower

Lloyds profits dip, prepares for bad loans

Lloyds Banking Group
Lloyds has set aside £377m for bad loans (pic: Terry Murden)

Lloyds Banking Group reported a dip in first-half profits but lifted its guidance for the year on the back of rapidly rising interest rates.

The owner of Bank of Scotland, Halifax and Scottish Widows said pre-tax profits for the six months to 30 June fell 6% to £3.66bn while net income surged 65% to £7.2bn.

It has set aside £377m to cover a possible increase in customer loan defaults as the economy weakens.

The board has announced an interim dividend of 0.80 pence per share, an increase of c.20 per cent on the prior year.

Lloyds said its net interest margin, the difference between savings and lending rates, was now expected to be greater than 280 basis points.

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