Seeking Alpha

Lloyds to take extra provisions of £1.93B

  • Lloyds (LYG) has taken a further provision of £1.8B to cover compensation for mis-sold payment-protection insurance and another £130M connected to the sale of interest-rate hedging products.
  • Lloyds expects to report that underlying profit more than doubled to £6.2B in 2013, "ahead of analyst consensus." Net interest margin was 2.12%, core loan growth 3% and the bank's Tier 1 ratio 10.3%.
  • In H2, Lloyds plans to apply to the Prudential Regulatory Authority (PRA) to resume dividend payments; the bank intends to start at a "modest level" but will aim to distribute "at least 50% of sustainable earnings" in the medium term.
  • Preparatory work has started for a possible future sale of the government's shares in Lloyds to the public. (PR)

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