Lloyds Banking Group Plc · LSE:LLOY
Lloyds Banking — Debt Investor Presentation (2020)
26 slides from Lloyds Banking's debt investor presentation, 2020
Slide 1: Fixed Income Investor Presentation FY 2019
FIXED INCOME INVESTOR PRESENTATION FY 2019
Slide 2: Group Overview & Strategy
Classification: Limited Group Overview & Strategy 2
Slide 3: Simple group structure with multiple issuance points
Capital, Funding & Classification:Results Group Overview Limited Liquidity Appendix Simple group structure with multiple issuance points HoldCo Main Entities Lloyds Banking Group Ratings A3 / BBB+ / A+ P-2 / A-2 / F1 Example Products Senior Unsecured - Capital Ring-Fenced Sub-Group Non-Ring-Fenced S
Slide 4: Market shares - opportunities for growth in targeted key segments
Capital, Funding & Group Overview Classification:Results Limited Liquidity Appendix Market shares - opportunities for growth in targeted key segments Channels market share Digital new business volumes1 18% Branch new business volumes1 22% Product market share Consumer credit card balances 24% PCA de
Slide 5: Well diversified loan book of £440bn
Capital, Funding & Group Overview Classification:Results Limited Liquidity Appendix Well diversified loan book of £440bn YE2019 Loans & Advances of £440bn Commercial Banking other, • Retail lending-focused loan book (77% of total 5bn, 1% Central items, 2bn, 1% lending) Mid Markets, 29bn, 7% Wealth ,
Slide 6: UK economy resilient in 2019 with some signs of improving outlook
Capital, Funding & Group Overview Classification:Results Limited Liquidity Appendix UK economy resilient in 2019 with some signs of improving outlook GDP growth1,2 CPI inflation and pay growth2 (% growth vs. previous quarter) (%) 4 0.6 3 0.4 +c.2% 2 0.2 1 0.0 0 2014 2015 2016 2017 2018 2019 2016 201
Slide 7: Transforming the Group for success in a digital world
Capital, Funding & Group Overview Classification:Results Limited Liquidity Appendix Transforming the Group for success in a digital world Targeted outcomes (2020) Progress to date Leading #1 UK digital bank 16.4m digitally active users Customer Maintain #1 branch network #1 branch network Experience
Slide 8: Significant ESG delivery, supported by Helping Britain Prosper plan
Capital, Funding & Group Overview Classification:Results Limited Liquidity Appendix Significant ESG delivery, supported by Helping Britain Prosper plan A proven track record New ambitious goal Environmental • Raised >£2.8bn in green bonds for UK corporate issuers, more than any other UK bank We aim
Slide 9: 2019 Results
Classification: Limited 2019 Results 9
Slide 10: Resilient underlying performance in a challenging environment
Capital, Funding & Group Overview Classification:Results Limited Liquidity Appendix Resilient underlying performance in a challenging environment (£m) 2019 2018 Change Net interest income 12,377 12,714 (3)% • Net income down 4% at £17.1bn Other income (incl. Vocalink) 5,732 6,010 (5)% - NII 3% lower
Slide 11: Resilient NIM; challenging other income; continued delivery on costs
Capital, Funding & Group Overview Classification:Results Limited Liquidity Appendix Resilient NIM; challenging other income; continued delivery on costs Net interest income and banking net interest margin Total costs(2) (£m) (£m) -5% 2.93% (9)bps +3bps +1bps 2.88% (3)% 8,765 109 68 12,714 137 12,377
Slide 12: Asset quality remains strong reflecting prudent approach to risk
Capital, Funding & Group Overview Classification:Results Limited Liquidity Appendix Asset quality remains strong reflecting prudent approach to risk Asset quality ratio (bps) 37 • Gross AQR of 37bps, net AQR of 29bps 8 29 - Asset quality remains stable excluding two material 8 corporate cases 28 29
Slide 13: Credit quality remains strong across all portfolios
Capital, Funding & Group Overview Classification:Results Limited Liquidity Appendix Credit quality remains strong across all portfolios New to arrears as proportion of total book (%) • Strong credit performance across Mortgage portfolio, 1.5% new to arrears remain low - Low average LTV of <45%; aver
Slide 14: Strategic progress alongside solid financial performance
Capital, Funding & Group Overview Classification:Results Limited Liquidity Appendix Strategic progress alongside solid financial performance • Group continues to Help Britain Prosper, whilst building Guidance for 2020 strategic advantage and delivering strong and • NIM of 2.75 – 2.80% sustainable re
Slide 15: Capital, Funding & Liquidity
Classification: Limited Capital, Funding & Liquidity 15
Slide 16: Robust capital position supported by strong capital generation
Capital, Funding & Classification:Results Group Overview Limited Liquidity Appendix Robust capital position supported by strong capital generation • Ongoing CET1 target unchanged at around 12.5% plus a management CET1 Ratio buffer of around 1% 13.9% • Some movement in capital requirements over 2019:
Slide 17: Interim MREL requirement met at 1 Jan 2020; on track for end-state
Capital, Funding & Classification:Results Group Overview Limited Liquidity Appendix Interim MREL requirement met at 1 Jan 2020; on track for end-state Transitional MREL Ratio 32.6% • Transitional MREL ratio of 32.6% and in excess of Jan 2020 interim requirement HoldCo Snr 25.7% 11.0% • On track to m
Slide 18: Strong liquidity position and stable LDR supported by robust core deposit base
Capital, Funding & Classification:Results Group Overview Limited Liquidity Appendix Strong liquidity position and stable LDR supported by robust core deposit base LCR well above regulatory minimum Robust core deposit base 128% 137% 150 125% 2019 • Average LCR % increased to 137% 126 131 125 100% 100
Slide 19: Successful execution of 2019 funding plan with continued diversification
Capital, Funding & Classification:Results Group Overview Limited Liquidity Appendix Successful execution of 2019 funding plan with continued diversification 2019 Public Funding by Product 2 Funding Portfolio by Maturity £bn 7 6 < 1 Year (MM) 3 • Successful execution of plan over 26% 22% 5 < 1 Year 2
Slide 20: IBOR transition progressing well
Capital, Funding & Classification:Results Group Overview Limited Liquidity Appendix IBOR transition progressing well External market LBG progress so far LBG focus in 2020 FCA has reiterated need for firms to accelerate transition to ensure they are First bank to issue SONIA-linked prepared for LIBOR
Slide 21: Appendix
Classification: Limited Appendix 21
Slide 22: Strong Insurance & Wealth performance
Capital, Funding & Group Overview Classification:Results Limited Liquidity Appendix Strong Insurance & Wealth performance Franchise Direct Intermediary Single Customer View • Strong 2019 performance following significant Group investment • Schroders Personal Wealth launched – ambition to become Top
Slide 23: Legal entity balance sheet analysis (H1 2019)
Capital, Funding & Classification:Results Group Overview Limited Liquidity Appendix Legal entity balance sheet analysis (H1 2019) Lloyds Bank Plc Lloyds Bank Corporate Markets Plc (RFB) (NRFB) £593bn £593bn £87bn £87bn 5 Other 29 Other Other 9 Other 56 10 Derivatives Derivatives 11 8 Financial 15 De
Slide 24: Notes
Classification: Limited Notes 24
Slide 25: Debt Investor Relations Contacts
Classification: Limited Debt Investor Relations Contacts Website: www.lloydsbankinggroup.com/investors/fixed-income-investors INVESTOR RELATIONS LONDON Douglas Radcliffe Edward Sands Nora Thoden Group Investor Relations Director Director, Investor Relations Director, Investor Relations +44 (0)20 735
Slide 26: Forward looking statements and basis of presentation
Classification: Limited Forward looking statements and basis of presentation Forward looking statements This document contains certain forward looking statements within the meaning of Section 21E of the US Securities Exchange Act of 1934, as amended, and section 27A of the US Securities Act of 1933,
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