Tuesday, 30 April 2013 10:26
Lloyds sees £2bn profit due to sale of St James's Place stake
Lloyds Banking Group has reported a £2bn pre-tax profit for the first quarter of 2013.
This figure is up from £280m at the end of the first quarter of 2012. This was driven by higher income including an addition of £394m relating to the sale of shares in St James's Place.
Lloyds announced it would be selling 101,703,070 St James's Place shares on 12 March in a bid to 'simplify the group and focus on core customer franchise'. Lloyds now holds a 37 per cent stake in the firm, down from 57 per cent.
Total underlying income was £4.9bn, an increase of three per cent.
Group chief executive Antonio Horta-Osorio said: "The increase was driven by higher income, which includes a gain of £394m relating to the sale of shares in St James's Place, continued improvements in cost efficiency and a further substantial reduction in impairment charges."
The firm said it received 15,000 payment protection insurance complaints each week on average. Total costs for PPI were £586m including £180m of administration costs. However, the firm said it had not made any further provision for redress.
The company also recently revealed that it would be rebranding 632 branches as TSB Bank after the Co-operative Group pulled out of a purchase. The sale of the 632 branches, known as Project Verde, is a requirement of the European Commission in return for the state help Lloyds received in 2008.
TSB would be visible on the High Street by this summer and this would operate as a separate business within the Group. A stock market listing would take place in mid-2014.
Looking ahead, Mr Horta-Osorio said: "We now expect total costs to be around £9.6bn in the full year 2013, down from our previous guidance of £9.8bn, as a result of the deconsolidation of St James's Place and further cost savings."
• Want to receive a free weekly summary of the best news stories from our website? Just go to home page and submit your name and email address. If you are already logged in you will need to log out to see the e-newsletter sign up. You can then log in again.