Lloyds profits surge amid post-lockdown optimism
By Matt Hall | 28th April 2021
Lloyds Banking Group has revealed a boost to profits in the first quarter of 2021, after a brighter economic outlook led the bank to reverse some of its loan loss provisions.
Last year, during the initial Covid-19 lockdown, several banks including Lloyds took large provisions in order to protect themselves against potential loan losses as the crisis developed.
However, actual loan defaults have remained low in the UK thanks to government support and the furlough scheme, which is said to have minimised job losses and prevented many businesses from going under.
And now Lloyds, which has an office in Barnwood, has released £459m from a cash pile of around £1.4bn set aside to cover the bad debts, and said it remains positive but cautious about the economic outlook for the UK.
The provision reversal made way for a pre-tax profit of £1.9bn for the three months to March, up from just £74m last year. But revenues dropped seven per cent year-on-year to £3.7bn.
Lloyds said that mortgages were up by £6bn over the period, with March seeing the highest level of completions since 2008.
Chief executive Antonio Horta-Osorio said: "The coronavirus pandemic continues to have a significant impact on people, businesses and communities in the UK and around the world.
"Whilst we are seeing positive signs, notably the progress of the vaccine rollout and the emergence from lockdown restrictions, the outlook remains uncertain."
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