Press and News
Lloyds Bank to return up to £4bn to investors
Caitlin Morrison published in The Independent: Lender said increase in PPI bill driven by higher-than-expected claims volumes last year
Lloyds Banking Group announced that it will return up to £4bn to shareholders, despite adding to its PPI bill last year. The banking giant posted pre-tax profits of £5.96bn for 2018, up 13 per cent compared with £5.28bn the previous year.
Lloyds hiked the dividend by 5 per cent to 3.21p per share and proposed a share buyback of up to £1.75bn, which represents a total return of up to £4bn to investors.
Operating costs were relatively steady in 2018 at £8.17bn and the company now expects costs to be less than £8bn this year, which is 12 months ahead of its initial target. Meanwhile, the group raised the provision for PPI costs by £750m last year, bringing the total amount provided by the bank to £19.4bn.
Lloyds said the increase was driven partly by a higher-than-expected number of complaints - 13,000 per week - and a jump in the average redress per complaint. However, analysts noted that with the deadline for PPI claims coming up this August, the banks profits have been boosted as the threat of further costs diminishes.
Article credit: Caitlin Morrison