Lloyds Banking Group, Britain’s largest mortgage lender, has reported a significant drop in profits for the first quarter of 2024. The company, which includes subsidiaries such as Halifax and Bank of Scotland, announced pre-tax profits of £1.6bn, a 28% decrease from the same period last year when it reported £2.3bn.
Despite the decline, Lloyds stated that these results were in line with their expectations and analysts had predicted profits of £1.7bn for the quarter. The decrease in profits has been attributed to higher business costs, including the new Bank of England levy, and lower net interest income.
This is the first major UK bank to release its first quarter results for this year. Following the publication of the figures, shares in the company dropped 2% when markets opened on Wednesday morning. This comes after Lloyds reported a record annual pre-tax profit of £7.5bn in 2023, which was credited to higher interest rates introduced by the Bank of England to combat inflation.
Lloyds CEO, Charlie Nunn, expressed confidence in the group’s strategic ambitions and 2024 and 2026 guidance, stating that the bank’s performance in the first quarter provides further reassurance. Nunn also emphasized the group’s commitment to supporting customers and aiding the prosperity of Britain.
In addition, Lloyds has updated its forecasts for the year ahead, reflecting the UK’s improving economic outlook. The company now estimates a 1.5% increase in house prices across the UK, after previously predicting a decline.
In January, Lloyds announced plans to cut approximately 1,600 jobs within its branch network as it shifts towards online banking. The group is also discontinuing its fleet of mobile banking vans as part of these plans.
