A number of factors dented the full-year profit result for the UK bank last year.

Lloyds Banking Group, a UK-listed bank, today said its underlying profit for 2024 fell 19 per cent year-on-year to £6.343 billion ($7.98 billion), and its statutory after-tax profit also fell by the same percentage to £4.477 billion.

Net income fell 5 per cent to £17.1 billion; operating costs narrowed by 3 per cent to £9.4 billion last year; remediation costs rose to £899 million. There was a 41 per cent year-on-year rise in underlying impairment charges, to £433 million, the bank said in a statement. Remediation costs stood at £899 million in the year (2023: £675 million); these included £775 million in the fourth quarter, of which £700 million was in relation to the potential impact of motor finance commission arrangements, the bank said. 

Within the wealth business, Lloyds said deposits stood at £10.2 billion at the end of 2024, slipping by 6 per cent from a year earlier, but up slightly from the end of September 2024.

The bank’s Common Equity Tier 1 ratio stood at 13.5 per cent at the end of December last year. 

Looking ahead, Lloyds said that based on current macroeconomic assumptions, it expects to make underlying net interest income of around £13.5 billion, and achieve return on tangible equity (ROTE) of about 1.35 per cent. For 2026, it aims at ROTE of more than 15 per cent. 

"The group delivered a robust financial performance in 2024. Pleasingly and as expected, income grew in the second half of the year, supported by a rising banking net interest margin and momentum in other income. We also maintained discipline in costs, whilst asset quality remained strong. This performance enabled total shareholder distributions of £3.6 billion,” Charlie Nunn, the group CEO, said.