Lloyds Banking Group Plc · LSE:LLOY
Lloyds Banking — Q3 2016 Earnings Presentation
13 slides from Lloyds Banking's earnings presentation, Oct 26, 2016
Slide 1: Q3 Interim Management Statement
TITLE SLIDE IS IN SENTENCE Q3 INTERIM MANAGEMENT CASE. STATEMENT GREEN BACKGROUND. Presentation to Analysts 26 October 2016 and Investors
Slide 2: Highlights for the First Nine Months of 2016
HIGHLIGHTS FOR THE FIRST NINE MONTHS OF 2016 Robust financial performance demonstrating the strength of the business model • Robust underlying performance with strong improvement in statutory profit – Underlying profit of £6.1bn with an increase in statutory profit before tax to £3.3bn – Positive op
Slide 3: UK Economic Environment
UK ECONOMIC ENVIRONMENT The UK faces a period of uncertainty from a position of strength UK private sector debt / GDP(1) (%) Unemployment rate(2) (%) 100 9 8 90 7 80 6 70 5 60 4 2006 2008 2010 2012 2014 2016 2006 2008 2010 2012 2014 2016 Households Corporate UK mortgage affordability(3) & average LT
Slide 4: Differentiated Business Model Positions Us Well
DIFFERENTIATED BUSINESS MODEL POSITIONS US WELL Well positioned to continue delivering for our customers and shareholders given our distinct competitive advantages Low cost business model CET1 Progress (%) Cost:income ratio – 2016 UK peer comparison(1) (%) 13.9 14.1 71 72 13.0 63 57 51 12.8 13.0 13.
Slide 5: Financial Performance
FINANCIAL PERFORMANCE Robust underlying performance YTD YTD (£m) 2016 2015 Change • Underlying profit of £6.1bn, driven by Net interest income 8,630 8,578 1% – 1% improvement in NII, reflecting an increased Other income 4,520 4,627 (2)% margin of 2.72% Total income 13,150 13,205 – – Slightly lower o
Slide 6: Financial Performance: Net Interest Income
FINANCIAL PERFORMANCE Net interest income performance reflects an improved margin, offset by lower other income Net interest income – vs. Q3 YTD 2015 (£m) Other income (£m) 58 8,630 4% 8,578 150 360 1,592 1,661 1,616 1,528 1,477 1,374 1,427 (516) Q3 YTD Asset Liability Wholesale One-off Q3 YTD Q1 Q2
Slide 7: Financial Performance: Statutory Profit
FINANCIAL PERFORMANCE Strong improvement in statutory profit YTD YTD (£m) 2016 2015 • Statutory profit before tax of £3.3bn, driven by Underlying profit 6,073 6,355 – £790m charge for ECNs redemption in Q1 ECNs (790) (369) – Market volatility and other includes £484m gain on Market volatility and ot
Slide 8: Balance Sheet: Capital Generation
BALANCE SHEET Capital generation remains strong Common equity tier 1 ratio (%) – Jun to Sep • Q3 capital generation of c.60bps in line with c.60bps underlying performance 0.5 0.6 0.1 14.1 13.5 13.4 (0.6) (0.7) • YTD capital generation of c.110bps with underlying of c.160bps partially offset by condu
Slide 9: Summary
SUMMARY Well positioned to continue delivering for customers and shareholders • UK economy faces uncertainty, but well 2016 GUIDANCE REAFFIRMED positioned given economic recovery in recent years • 2016 NIM expected to be around 2.70% • Our differentiated business model is delivering • Year-on-year r
Slide 10: Appendix
TITLE SLIDE IS IN APPENDIX CASE. SENTENCE GREEN BACKGROUND.
Slide 11: Delivering Prudent Growth
DELIVERING PRUDENT GROWTH Supporting the UK economy with continued loan growth in targeted customer segments Net lending growth (£bn) Average interest earning assets (AIEAs) (£bn) YoY YoY (%) 446.5 443.2 438.7 439.2 438.2 435.6 435.9 17.0 15.8 13.2 11.4 11.0 10.7 10.7 Mortgages (2.6) (1) 429.5 427.4
Slide 12: Balance Sheet: Tangible Net Assets per Share
BALANCE SHEET TNAV per share of 54.9p increased YTD, driven by strong statutory profit and reserve movements Tangible net assets per share (p) – Dec to Sep • TNAV per share increased 2.6p YTD with an increase 8.5 5.5p of 5.5p before dividend payments: 2.9 57.8 – Strong statutory profit after conduct
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