Lloyds 1Q Pretax Profit Plunged on GBP1.4 Billion Impairments as Pandemic Hit
30 April 2020 - 5:00PM
Dow Jones News
By Sabela Ojea
Lloyds Banking Group PLC reported Thursday a significant fall in
pretax profit for the first quarter of 2020 due to
higher-than-expected impairments and said it is suspending its
previous guidance.
The U.K.'s largest retail bank made a pretax profit of 74
million pounds ($92.1 million) compared with GBP1.60 billion for
the first quarter of 2019.
The London-listed' lender's net income fell to GBP3.95 billion
from GBP4.42 billion in the year-earlier period due to lower
interest rates, competitive asset markets and a slowdown in retail
and commercial markets in March due to the coronavirus
pandemic.
Lloyds' pretax profit had been expected to fall to GBP863.3
million, taken from Lloyds' compiled consensus and based on 10
estimates. Its net income was anticipated to decrease to GBP4.04
billion, also taken from Lloyds' compiled consensus and based on 10
estimates.
The bank took impairments of GBP1.43 billion in the period
compared with GBP275 million in the first quarter of 2019. The bank
cited the coronavirus pandemic, and said impairments were expected
to increase to GBP890 million, according to Lloyds' compiled
consensus.
Lloyd's pro forma common equity Tier 1 ratio--a key measure of
balance-sheet strength--stood at 14.2%, up from 13.9% as at March
31, 2019. Its net interest margin fell 12 basis points to
2.79%.
"The economic outlook is clearly challenging with the
longer-term outcome dependent on the severity and length of the
pandemic and the mitigating impact of the government and other
measures in the U.K. and across the world," Chief Executive Antonio
Horta-Osorio said.
Write to Sabela Ojea at sabela.ojea@wsj.com; @sabelaojeaguix
(END) Dow Jones Newswires
April 30, 2020 02:45 ET (06:45 GMT)
Copyright (c) 2020 Dow Jones & Company, Inc.
Lloyds Banking (LSE:LLOY)
Historical Stock Chart
From Apr 2024 to May 2024
Lloyds Banking (LSE:LLOY)
Historical Stock Chart
From May 2023 to May 2024