Lloyds Banking Group Plc · LSE:LLOY
Lloyds Banking — ShareSoc Webinar (March 2024)
16 slides from Lloyds Banking's conference presentation, Mar 14, 2024
Slide 1: Lloyds Banking Group, 14 March 2024
Classification: Public Lloyds Banking Group 14 March 2024 1
Slide 2: Business and financial update
Classification: Public Business and financial update Douglas Radcliffe, Group Investor Relations Director 2
Slide 3: Lloyds Banking Group in context
Classification: Public Lloyds Banking Group in context Largest UK Purpose bank Digitally active Loans and advances UK distribution network customers Helping A trusted Britain brand portfolio Robust financial performance Net income Return on tangible equity Total capital return (RoTE) 3
Slide 4: Purpose-driven strategy delivers for broader stakeholders
Classification: Public Purpose-driven strategy delivers for broader stakeholders Illustrative activity in 2023 Communicated with >15m customers on savings options and 3.9m new savings accounts opened Proactive 7.5m1 customers proactively contacted to offer support and enhance financial resilience su
Slide 5: Significant strategic progress, on track for 2024 and 2026
Classification: Public Significant strategic progress, on track for 2024 and 2026; confidence in delivering higher, more sustainable returns Grow Purpose-driven strategy Significant progress in 2023 On track for 2024 and 2026 2024 £1.3bn strategic investment Drive revenue growth (£2.2bn to date) c.£
Slide 6: Robust financial performance, in line with guidance
Classification: Public Robust financial performance, in line with guidance Financial performance (£m) 2023 20222 YoY Net interest income 13,765 13,172 5% • Statutory PAT £5.5bn; RoTE 15.8% Other income 5,123 4,666 10% Operating lease depreciation (956) (373) • Strong net income, up 3%, NIM 311bps Ne
Slide 7: Resilience in customer franchise
Classification: Public Resilience in customer franchise Q4 lending change (£bn) Q4 deposit change (£bn) Retail (+£0.8bn ex. securitisation) Commercial Retail Commercial -£1.9bn/-1% -£2.9bn/-3% +£1.8bn/+1% -£0.9bn/-1% • Lending £450bn; 2023 down 1%, Q4 down £2bn 3.7 o Retail up £0.8bn ex securitisati
Slide 8: Strong net interest income, in line with guidance
Classification: Public Strong net interest income, in line with guidance Average interest earning assets (£bn) 2.2 2.5 (0.2) (3.2) 453 452 • 2023 NII £13.8bn, up 5% YoY, Q4 down 4% vs Q3 • Full year NIM 311bps; 298bps in Q4, down 2022 Mortgages1 Unsecured & Commercial Other inc. 2023 Motor Banking E
Slide 9: Disciplined operating costs, in line with guidance
Classification: Public Disciplined operating costs, in line with guidance Operating costs (£m) +5% 350 48 346 • 2023 operating costs £9.1bn, up 5%; planned 9,140 8,672 (276) strategic investment, new business and inflation • Now expect 2024 operating costs c.£9.3bn 2022 Cost Pay & Investment, Other
Slide 10: Strong asset quality, in line with guidance
Classification: Public Strong asset quality, in line with guidance Impairment (£m) Q4 2023 2022 YoY • 2023 impairment charge £308m Charge (credit) pre updated MES1 (353) 565 915 (350) Retail 277 1,064 773 291 o Significant reduction vs 2022 due to Commercial Banking (626) (487) 122 (609) release bas
Slide 11: Updated macroeconomic outlook
Classification: Public Updated macroeconomic outlook CPI inflation UK bank rate 12% 6% 10% 5% 8% 4% • GDP growth to remain subdued in 2024; 6% 3% sharply declining inflation expected to 4% 2% benefit HPI1 o GDP expected to rise 0.5% in 2024 2% 1% 0% 0% o Recent decline in inflation expected to Q4 Q2
Slide 12: Strong capital generation, in line with guidance
Classification: Public Strong capital generation, in line with guidance Risk weighted assets (£bn) • RWAs £219.1bn, up £8.2bn, inc. £1.4bn in Q4 3.0 5.0 2.2 2.3 3.1 • Continue to expect 2024 RWAs £220-225bn (7.4) 219.1 • Strong 173bps capital generation2 210.9 • Capital return £3.8bn, c.14% market c
Slide 13: Consistent guidance; confidence in delivering higher, more sustainable returns
Classification: Public Consistent guidance; confidence in delivering higher, more sustainable returns 2024 2026 Income NEW: NIM >290bps Costs NEW: c.£9.3bn operating costs <50% cost:income ratio Asset quality ratio NEW: <30bps Return on tangible equity c.13% >15% Risk weighted assets £220bn - £225bn
Slide 14: Confidence in delivering higher, more sustainable returns
Classification: Public Confidence in delivering higher, more sustainable returns Purpose • Customer support continuing in a resilient economy Helping • Purpose-driven strategy, on track to meet strategic outcomes Britain • Strong business performance, meeting 2023 financial guidance • Increased shar
Slide 15: Q&A
Classification: Public Q&A Douglas Radcliffe, Group Investor Relations Director 15
Slide 16: Disclaimer
Classification: Public Disclaimer Important notice The information, statements, views and opinions contained in this document and accompanying discussion (“this Presentation”) are for informational and reference purposes only. This Presentation has been provided by the Group (defined below). This Pr