Lloyds talks up UK recovery and pays out extra dividendComments Off on Lloyds talks up UK recovery and pays out extra dividend
Britain is in a longer and more robust recovery cycle than some claim, the boss of Lloyds Banking Group said today, as the former taxpayer-controlled bank cheered investors with an extra dividend payout.
“We are seeing robust growth across sectors and across regions,” said chief executive Antonio Horta-Osorio.
“I am quite positive on the outlook for the UK economy and, given that we handle 18% of SME accounts and 25% of current accounts in this country, we have pretty good visibility.
“This is being achieved with a lower level of debt, which is not what is happening anywhere else in the world. Total debt — personal, corporate and even public — is coming down as a proportion of GDP, which I interpret as the recovery cycle being a longer one.”
Lloyds also revealed another provision for PPI mis-selling with a charge of £2.1 billion in the final quarter taking the charge for the year to £4 billion and the total since 2010 to £16 billion, more than the other banks put together.
It said it expects the number of claims to start climbing again as the regulator imposes an expected deadline for final claims in 2018.
The PPI hit helped to knock Lloyds’ pre-tax profits from £1.8 billion to £1.6 billion although the underlying profit on which the bank prefers to focus and which does not include one-off charges rose by 5% to £8.1 billion.
Horta-Osorio said: “Our total income was up 1% to £17.6 billion, our costs were down slightly again and our bad debt impairments were down sharply.”
The bad debt charge fell by 48% to £568 million.
It is declaring a final dividend of 1.5p, taking the total for the year to 2.25p and, after getting clearance from the Bank of England, announced a 0.5p special dividend paid out of excess capital above the regulator’s requirements.
Lloyds’ shares jumped 10%, or 6p, to 68.2p.