Lloyds Banking Group Plc · LSE:LLOY
Lloyds Banking — Q3 2015 Earnings Presentation
13 slides from Lloyds Banking's earnings presentation, Oct 28, 2015
Slide 1: Q3 Interim Management Statement
TITLE SLIDE IS IN SENTENCE Q3 INTERIM MANAGEMENT CASE. STATEMENT GREEN BACKGROUND. Presentation to Analysts and Investors 28 Month 00 October 2015 0000 Presenters Name
Slide 2: Highlights for the First Nine Months of 2015
HIGHLIGHTS FOR THE FIRST NINE MONTHS OF 2015 Resilient financial performance, with improved profitability and strengthened capital position demonstrating strength of business model • Robust UK economy; low unemployment, increased house prices, increased consumer spending and lower household debt • O
Slide 3: Financial Performance – First Nine Months of 2015
FINANCIAL PERFORMANCE – FIRST NINE MONTHS OF 2015 6% increase in underlying profit, with significant improvement in statutory profit. Strong balance sheet maintained £13.2bn Income • Underlying profit increased 6% to £6.4bn with return on required 0% equity of 15.7% – Income flat: 4% improvement in
Slide 4: Financial Performance
FINANCIAL PERFORMANCE Resilient performance in the first nine months with income flat, lower costs and a significant reduction in impairments Income(1) (£bn) Operating costs (£m) 4.4 4.4 4.5 (1)% 4.2 4.2 1.6 1.6 1.7 1.4 6,101 319 20 6,069 1.5 86 (358) (99) 2.8 2.7 2.8 2.9 2.9 Q3 2014 Q4 2014 Q1 2015
Slide 5: Financial Performance
FINANCIAL PERFORMANCE Significant increase in statutory profit to £2.2bn despite loss on sale of TSB and conduct charges YTD YTD (£m) 2015 2014 • 33% increase in statutory profit to £2.2bn Underlying profit 6,355 5,974 • Asset sales includes £369m charge for change in value of ECNs and negative insu
Slide 6: Delivering for Our Customers and Shareholders
DELIVERING FOR OUR CUSTOMERS AND SHAREHOLDERS Delivering sustainable growth by supporting the UK economy through loan growth in key customer segments Net lending growth(1) (£bn) YoY YoY (%) • Lending growth of 1%, YTD annualised growth of 2% Mortgages 2.4 1 • Mortgage growth remains below market Uns
Slide 7: Balance Sheet
BALANCE SHEET Strong balance sheet maintained with continued capital generation and TNAV progression in the third quarter Average interest earning assets (£bn) Tangible net assets per share (p) 459 454 0.9 447 443 439 2.2 55.8 28 23 17 54.9 55.0 16 13 53.5 (0.7) (0.1) (0.8) 431 431 430 427 426 Q3 20
Slide 8: Summary
SUMMARY The Group’s differentiated business model continues to deliver • Robust UK economic outlook positions us well for the future • Resilient underlying profit and returns with significant improvement in statutory profit • Strong balance sheet maintained with improvements in CET1 ratio and levera
Slide 9: Appendix
TITLE SLIDE IS IN SENTENCE APPENDIX CASE. GREEN BACKGROUND. 00 Month 0000 Presenters Name
Slide 10: Further Strengthening the Balance Sheet
FURTHER STRENGTHENING THE BALANCE SHEET Strong capital base positions us well in evolving regulatory environment Capital composition(1) (%) £bn • Strong total capital ratio of 22.2% 22.0 22.2 49.9 Tier 2 Tier 2 4.0 8.9 4.5 • Credit ratings affirmed or upgraded by S&P, Moody’s ECN tier 2 1.0 2.3 ECN
Slide 11: Low Risk Business Model
LOW RISK BUSINESS MODEL Significant progress in strengthening and de-risking the balance sheet resulting in one of the lowest CDS spreads in the banking industry UK bank CDS(1) Bank Current level(2) Change since (bps) Sep 2012 (bps) 300 LBG 47 (203) Barclays 55 (157) 270 RBS 64 (197) 240 HSBC 67 (62
Slide 12: Legacy Issues – PPI
LEGACY ISSUES – PPI Additional PPI provision of £0.5bn in the third quarter Average complaint volumes per month(1) PPI provision analysis(2) (bn) Cumulative Unutilised Q3 charge (65)% provision Sep 2015 150,000 Past business review – 1.7 0.1 100,000 (8)% Remediation 0.1 1.6 0.4 50,000 Reactive 0.4 1
Slide 13: Forward Looking Statement and Basis of Presentation
FORWARD LOOKING STATEMENT AND BASIS OF PRESENTATION FORWARD LOOKING STATEMENTS This document contains certain forward looking statements with respect to the business, strategy and plans of Lloyds Banking Group and its current goals and expectations relating to its future financial condition and perf