Lloyds Banking Group reported a 20% decrease in annual pre-tax profits for 2024, totaling £5.97 billion, which fell short of City forecasts. Contributing factors included a decline in net interest margins, rising costs, and one-time charges related to an ongoing motor finance commission scandal, resulting in a £700 million provision. Despite challenges, the bank noted increases in loans and customer deposits, reflecting customer confidence. Additionally, there are signs of improved economic conditions, influenced by a positive assessment of risks and growth in UK house prices.
In spite of these headwinds, Lloyds reported loans and advances to customers rose by £10.2 billion last year to £459.9 billion, with UK mortgages increasing by £6.1 billion.
Charlie Nunn, chief executive of Lloyds, noted that the £700 million provision was prompted by the appeal court ruling, which goes "beyond the scope of the original FCA motor finance commissions review".
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