Lloyds Pleases Market with Buyback Despite Profit Miss -- Earnings Review
February 21 2018 - 05:55AM
Dow Jones News
By Adam Clark
Lloyds Banking Group PLC (LLOY.LN) reported its 2017 results at
0700 GMT on Wednesday. Here's what we watched:
PROFIT: Lloyds reported a pretax profit of 5.28 billion pounds
($7.38 billion) for 2017 compared with GBP4.32 billion in 2016. The
profit figure missed analyst expectations of GBP5.89 billion,
dragged down by a provision for payment protection insurance
mis-selling and conduct charges.
REVENUE: Total income rose to GBP18.53 billion from GBP17.50
billion. This beat analyst expectations of GBP18.50 billion.
SHARE BUYBACK: Lloyds fulfilled expectations of increasing
returns to shareholders after its return to full private ownership,
declaring a share buyback of up to GBP1 billion.
PPI PROVISION: Lloyds' results included GBP1.65 billion in
provisions related to claims for historic mis-selling of payment
protection insurance. In the fourth quarter, Lloyds added a further
GBP600 million to the amount it had already set aside for PPI, with
claims on the rise ahead of a deadline for compensation in the
long-running scandal.
TECHNOLOGY INVESTMENT: In a strategy update, Chief Executive
Antonio Horta Osorio said Lloyds intends to invest more than GBP3
billion in strategic initiatives over 2018-2020, including further
digitization. The investment was put forward as part of a drive to
lower costs, with Lloyds targeting a cost-to-income ratio
percentage in the low 40s by the end of 2020.
RETIREMENT SAVINGS EXPANSION: Lloyds said it intends to grow its
financial planning-and-retirement business, increasing its open
book assets by more than GBP50 billion by 2020 and adding more than
one million new pension customers. This follows Lloyds' purchase of
the U.K. pensions-and-savings business of Zurich Insurance Group AG
(ZURN.EB) in October.
Write to Adam Clark at adam.clark@dowjones.com;
@AdamDowJones
(END) Dow Jones Newswires
February 21, 2018 05:40 ET (10:40 GMT)
Copyright (c) 2018 Dow Jones & Company, Inc.
Lloyds Banking (NYSE:LYG)
Historical Stock Chart
From Feb 2024 to Mar 2024
Lloyds Banking (NYSE:LYG)
Historical Stock Chart
From Mar 2023 to Mar 2024