London — Lloyds Banking Group (LBG) announced soaring
annual profits on Wednesday on lower charges linked to an insurance
scandal, as it awaits a full return to the private sector following a
state bail-out.
Net profit surged more than four times to £2bn in 2016 compared with net profit of £466m in the year-earlier period, LBG said in an earnings release.
"We have delivered strong financial performance in 2016 as we continue to make good progress against our strategic priorities," group CE Antonio Horta-Osorio said in the statement.
LBG said it took another £1bn hit to compensate customers who were mis-sold insurance, although this was much reduced compared with a bill of £4bn in 2015 regarding the same issue.
Lloyds’ compensation for mis-sold payment protection insurance (PPI) now totals more than £17bn — far more than other British banks caught up in the long-running scandal.
In 2011, British banks lost a high court appeal against tighter regulation of PPI, which provides insurance for consumers should they fail to meet repayments on a credit product such as consumer loans, mortgages or payment cards. PPI became controversial after it was revealed that many customers had been sold it without understanding that the cost was being added to their loan repayments. British authorities subsequently banned simultaneous sales of PPI and credit products.
Lloyd’s update meanwhile comes with it close to its full return to the private sector.
The British government is no longer the biggest shareholder in LBG after recently reducing its stake to less than 5%. The government rescued Lloyds with £20bn of taxpayers’ money at the height of the global financial crisis in 2008, since then the state has sold down its original stake of 43%.
"The combination of the progress we have made towards our strategic priorities and our strong financial performance has enabled the UK government to further reduce its stake in the group to less than 5% ... returning over £18.5bn to the UK taxpayer since 2009," LBG said on Wednesday.
It means that US fund manager BlackRock is now the bank’s single biggest stakeholder.
AFP | BDlive
Net profit surged more than four times to £2bn in 2016 compared with net profit of £466m in the year-earlier period, LBG said in an earnings release.
"We have delivered strong financial performance in 2016 as we continue to make good progress against our strategic priorities," group CE Antonio Horta-Osorio said in the statement.
LBG said it took another £1bn hit to compensate customers who were mis-sold insurance, although this was much reduced compared with a bill of £4bn in 2015 regarding the same issue.
Lloyds’ compensation for mis-sold payment protection insurance (PPI) now totals more than £17bn — far more than other British banks caught up in the long-running scandal.
In 2011, British banks lost a high court appeal against tighter regulation of PPI, which provides insurance for consumers should they fail to meet repayments on a credit product such as consumer loans, mortgages or payment cards. PPI became controversial after it was revealed that many customers had been sold it without understanding that the cost was being added to their loan repayments. British authorities subsequently banned simultaneous sales of PPI and credit products.
Lloyd’s update meanwhile comes with it close to its full return to the private sector.
The British government is no longer the biggest shareholder in LBG after recently reducing its stake to less than 5%. The government rescued Lloyds with £20bn of taxpayers’ money at the height of the global financial crisis in 2008, since then the state has sold down its original stake of 43%.
"The combination of the progress we have made towards our strategic priorities and our strong financial performance has enabled the UK government to further reduce its stake in the group to less than 5% ... returning over £18.5bn to the UK taxpayer since 2009," LBG said on Wednesday.
It means that US fund manager BlackRock is now the bank’s single biggest stakeholder.
AFP | BDlive
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