Lloyds Banking Group Plc · LSE:LLOY

Lloyds Banking — FY2010 Earnings Presentation

13 slides from Lloyds Banking's earnings presentation, Feb 25, 2011

  1. Slide 1: 2010 Results

    2010 RESULTS 25 February 2011 Eric Daniels Group Chief Executive

  2. Slide 2: Business Highlights: A year of significant progress

    BUSINESS HIGHLIGHTS A year of significant progress STRONG OPERATING PERFORMANCE RISK REDUCED ƒ Balance sheet reduction plan ƒ Step change in profitability ahead of schedule ƒ Sharp fall in impairments ƒ Funding risk much reduced ƒ Good franchise momentum ƒ Capital position further strengthened ƒ Int

  3. Slide 3: The Building Blocks for a Strong Business

    THE BUILDING BLOCKS FOR A STRONG BUSINESS Driving customer value, earnings, capital and returns Value SUSTAINABLE GROWTH creation ƒ Efficiency, effectiveness ƒ Customer value ƒ Deep relationships ƒ Quality market share PROFITABILITY ƒ Complete integration ƒ Drive elements of profit model ƒ Optimise

  4. Slide 4: Step Change in Profitability in 2010

    STEP CHANGE IN PROFITABILITY IN 2010 Combined businesses results £22.9bn £23.6bn INCOME(1) UP 3% 2009 2010 STEP CHANGE IN PROFITABILITY £11.6bn £10.9bn £2.2bn COSTS DOWN 6% (£6.3bn) 2009 2010 2009 2010 £24.0bn IMPAIRMENTS DOWN 45% £13.2bn 2009 2010 (1) Excluding liability management gains and fair v

  5. Slide 5: Sharp Fall in Impairments

    SHARP FALL IN IMPAIRMENTS Lloyds risk disciplines showing through in more predictable impairments UK, US IRELAND, AUSTRALIA IMPAIRMENTS DOWN AS IMPAIRMENTS HIT BY ECONOMY RECOVERS WEAKER ECONOMIES WHOLESALE RETAIL £15.7bn 0.8 14.9 £4.4bn £5.6bn £4.2bn 0.2 £3.8bn 1.3 £2.7bn 3.4 0.9 4.2 2.4 4.3 2.9 0.

  6. Slide 6: Good Franchise Momentum in 2010

    GOOD FRANCHISE MOMENTUM IN 2010 Building the drivers of future growth GROWING THE SUPPORTING THE FRANCHISE ECONOMIC RECOVERY ƒ 1.9 million new personal current accounts ƒ £30 billion gross mortgage ƒ 5.2 million new savings lending (including accounts, 5% growth in retail remortgages) savings book ƒ

  7. Slide 7: Integrating the Business

    INTEGRATING THE BUSINESS Integration in the final phase KEY DEVELOPMENTS RUN-RATE COST SAVINGS ƒ Standardised operating model £2,000m ƒ Harmonised terms and conditions £1,379m £766m ƒ Standardised procurement and property processes 2009 2010 2011 ƒ Major systems changes target 6

  8. Slide 8: Balance Sheet Reduction Ahead of Schedule

    BALANCE SHEET REDUCTION AHEAD OF SCHEDULE ASSETS TARGETED FOR RUN-DOWN KEY POINTS ƒ Asset reduction programme halfway to goal £300bn – Goal: £200 billion asset £236bn run-off £195bn ƒ £41 billion reduction achieved in 2010 – Across all target asset groups 2008 2009 2010 ƒ Value-based approach ƒ Sale

  9. Slide 9: Funding Risk Much Reduced

    FUNDING RISK MUCH REDUCED TERM ISSUANCE WHOLESALE FUNDING <1 YEAR £162bn £149bn £50bn £10bn(1) 2009 2010 End 2009 End 2010 CENTRAL BANK FUNDING LOAN:DEPOSIT RATIO 169% 154% £157.2bn £96.6bn End 2009 End 2010 End 2009 End 2010 (1) Excluding government guaranteed issuance 8

  10. Slide 10: Capital Position Further Strengthened

    CAPITAL POSITION FURTHER STRENGTHENED CORE TIER 1 RATIO STRONG CAPITAL POSITION ƒ Reduced our risk profile in 2010 10.2% 8.1% ƒ Well placed for Basel III 5.6% ƒ Robust performance in stress tests ƒ Core tier 1 ratio including 31 Dec 31 Dec 31 Dec 2008 2009 2010 ECNs would be 12.1% 9

  11. Slide 11: Performing in Line with Our 2010 Guidance

    PERFORMING IN LINE WITH OUR 2010 GUIDANCE Now getting more predictable financials GUIDANCE 2010(1) High single digit growth REVENUE(2) GROWTH within 2 years 9 Margin expected to MARGINS increase to c.2% 9 c.200 p.a. basis points COST:INCOME RATIO improvement 9 Run rate savings of INTEGRATION BENEFIT

  12. Slide 12: Summary: A year of significant progress

    SUMMARY A year of significant progress RETURN TO PROFITABILITY RISK REDUCED ƒ Group delivering profits in 2010 ƒ Balance sheet being ƒ Good franchise momentum restructured across all divisions ƒ Funding position enhanced ƒ Integration programme on track ƒ Capital position strengthened ƒ Trajectory i

  13. Slide 13: Forward Looking Statements

    FORWARD LOOKING STATEMENTS This announcement contains forward looking statements with respect to the business, strategy and plans of the Lloyds Banking Group, its current goals and expectations relating to its future financial condition and performance. Statements that are not historical facts, incl

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