Lloyds Banking Group Plc · LSE:LLOY
Lloyds Banking — Q3 2019 Earnings Presentation
9 slides from Lloyds Banking's earnings presentation, Oct 31, 2019
Slide 1: Q3 Interim Management Statement
Q3 INTERIM MANAGEMENT STATEMENT Presentation to analysts and investors | 31 October 2019
Slide 2: Solid financial performance in a challenging environment
Solid financial performance in a challenging environment Q3 2019 Year to date £13.0bn • Statutory profit before tax of £2.9bn for the nine months, down 40%, Net income (3)% significantly impacted by additional PPI charge of £1.8bn in Q3 Cost:income ratio 46.5% • Underlying profit of £6.0bn, down 5%,
Slide 3: Solid financial performance: ongoing cost reduction continues to partly offset income pressure
Solid financial performance: ongoing cost reduction continues to partly offset income pressure in a challenging rate environment Net interest income Operating costs (£m) (£m) 2.93% (11)bps 5bps 2bps 2.89% (3)% (3)% 6,014 9,544 78 148 9,275 82 5,817 (14) (80) (403) (277) Q3 2018 Asset spread Liabilit
Slide 4: Low risk business model with prudent participation choices: underlying credit quality remains strong
Low risk business model with prudent participation choices: underlying credit quality remains strong Asset quality ratio (bps) 38 40 • Gross AQR in Q3 of 40bps with net AQR of 33bps, both 33 impacted by a single large corporate charge and lower 10 27 18 used car prices 10 18 30 30 30 - AQRs remain l
Slide 5: Solid profits and returns with statutory performance impacted by additional PPI charge in Q3
Solid profits and returns with statutory performance impacted by additional PPI charge in Q3 Q3 2019 Q3 2018 • Underlying profit of £6.0bn, down 5% (£m) YTD YTD Change Underlying profit 6,016 6,303 (5)% • Restructuring costs lower due to completion of MBNA migration and ring-fencing; includes Restru
Slide 6: Balance sheet: ongoing growth in targeted segments while continuing to optimise the portfolio
Balance sheet: ongoing growth in targeted segments while continuing to optimise the portfolio Loans and advances (£bn) • Prudent lending growth in targeted segments Q3 2019 271 19 52 63 39 447 - Open mortgage book up £6.1bn on Q2 due to £3.7bn Tesco portfolio acquisition and strong organic growth of
Slide 7: Continued robust capital build excluding PPI; lower Pillar 2A with capital target maintained
Continued robust capital build excluding PPI; lower Pillar 2A with capital target maintained Common equity tier 1 ratio (%) +28bps • Free capital build YTD of 149bps pre-PPI; +149bps 1.48 0.12 15.4 28bps after PPI charges (0.11) 0.34 • CET1 13.5% after dividend accrual and PPI; 13.9 (0.09) includes
Slide 8: Strong strategic progress and solid financial performance position the Group well
Strong strategic progress and solid financial performance position the Group well • Strong strategic progress and the right strategy in the current challenging market environment OUR Helping Britain PURPOSE Prosper • Business model resilience reflected in 2019 guidance - NIM expected to be 288bps an
Slide 9: Forward looking statements and basis of presentation
Forward looking statements and basis of presentation Forward looking statements This document contains certain forward looking statements with respect to the business, strategy, plans and/or results of Lloyds Banking Group plc together with its subsidiaries (the Group) and its current goals and expe