Lloyds Banking Group Plc · LSE:LLOY
Lloyds Banking — Q1 2019 Earnings Presentation
9 slides from Lloyds Banking's earnings presentation, May 2, 2019
Slide 1: Q1 Interim Management Statement
Q1 INTERIM MANAGEMENT STATEMENT Presentation to analysts and investors | 2 May 2019
Slide 2: Strong start to the second year of the Group's current strategic plan
Strong start to the second year of the Group’s current strategic plan Transforming the Group for Further progress on digitising the Group and enhancing customer propositions success in a digital world • Strategic investment of £1.2bn to date; technology spend 17% of operating costs • MBNA migration
Slide 3: Strong business performance with increased profits and market leading returns
Strong business performance with increased profits and market leading returns £4.4bn Net income +2% Cost:income ratio 44.7% • Statutory profit after tax of £1.2bn up 2% with strong RoTE of 12.5% (incl. remediation) (3.1)pp and EPS up 2% to 1.49p; TNAV up 0.4p on year end to 53.4p Cost:income ratio 4
Slide 4: Strong financial performance with resilient margin and reducing costs
Strong financial performance with resilient margin and reducing costs Net interest income Operating costs (£m) (£m) 2.93% (12)bps 9bps 1bps 2.91% (3)% (3)% 2,008 3,171 28 7 15 1,957 92 3,083 (19) (101) (161) Q1 2018 Asset spread Liability Wholesale Q1 2019 Cost Pay & Investment Q1 2018 Other Q1 2019
Slide 5: Low risk business model with prudent participation choices
Low risk business model with prudent participation choices Asset quality ratio (bps) -4 -5 -5 • Gross AQR stable on Q4 2018 at 30bps; net AQR up -8 -12 on Q4 due to expected lower releases and write backs 30 30 30 27 23 26 25 25 • Underlying credit quality remains strong with no 18 18 deterioration
Slide 6: Continued improvement in statutory profit and returns
Continued improvement in statutory profit and returns Q1 Q1 (£m) 2019 2018 Change • Statutory profit after tax of £1.2bn, up 2% Underlying profit 2,168 2,004 8% ‐ Restructuring includes completion of MBNA Restructuring (126) (138) 9% migration, severance costs and initial costs to Volatility and oth
Slide 7: Continued growth in targeted segments while continuing to optimise the portfolio
Continued growth in targeted segments while continuing to optimise the portfolio Loans and advances (£bn) Q1 2019 264 21 51 63 39 441 • Prudent lending growth in targeted segments Q1 2018 267 23 49 61 41 445 - Open mortgage book reduction due to expected maturities and ongoing pricing discipline; co
Slide 8: Continued strong capital build with lower capital target; all guidance reaffirmed
Continued strong capital build with lower capital target; all guidance reaffirmed Common equity tier 1 ratio (%) • CET1 capital build of 31bps in the first quarter includes +31bps 11bps expected one-off impact of IFRS 16 +42bps • CET1 guidance has reduced from c.13% to c.12.5%, 0.52 0.05 plus a mana
Slide 9: Forward looking statements
Forward looking statements Forward looking statements This document contains certain forward looking statements with respect to the business, strategy, plans and/or results of the Group and its current goals and expectations relating to its future financial condition and performance. Statements that