Lloyds turnaround continues despite more charges

0

LONDON (AP) — Lloyds bank, the part-nationalized British
lender, on Monday set aside another 1.9 billion pounds ($3.1 billion) to
cover the excesses of the past, but said it is ready to shed state
ownership and pay a dividend again for the first time since the
financial crisis.
The company warned it would need to set aside
1.8 billion to claims resulting from the miss-selling of payment
protection insurance — bringing the total to almost 10 billion pounds.
Some 130 million pounds was also set aside for interest rate hedging
products that were inappropriately sold to small and mid-size
businesses.
The group said in a preliminary earnings statement
that the charges would result in an underlying profit of 6.2 billion
pounds for 2013. The figure, which has to be confirmed in final earnings
figures to be released next week, was still above analyst expectations.
Lloyds
Banking Group PLC confirmed it has begun the preparatory work to sell
the government’s stake. The move had been telegraphed in speeches by
Treasury chief George Osborne late last year. It also said it would pay a
dividend for 2013, the first since the bank received a 20 billion-pound
rescue from taxpayers in 2008.
"We expect to apply in the second
half of 2014 to restart dividend payments and to deliver progressive and
sustainable payments to shareholders thereafter," said Chief Executive
Antonio Horta-Osorio. "This will be another important step in our
journey to rebuild trust and confidence in our group."
Richard
Hunter, the head of equities at Hargreaves Lansdown Stockbrokers, said
that while the profit figure was positive, the extra charge was
worrying.
"The (payment protection insurance) number is
disappointing not only in terms of the cumulative figure now nudging 10
billion pounds, but also because it perpetuates concerns around when
this saga will actually come to an end."
Copyright 2014 The Associated Press. All rights
reserved. This material may not be published, broadcast, rewritten or
redistributed.

No posts to display