(Updated with LIBOR comments)

The wealth unit of Lloyds Banking Group, the UK-listed bank that is partly owned by the taxpayer, logged a 17 per cent year-on-year increase in income to £176 million (around $272 million), it said today.

The wealth business is held within the wealth, asset finance and international segment of Lloyds Banking Group. This segment logged an underlying loss of £1.297 billion in the six months to 30 June this year, the bank said. That is narrower than a loss of £2.07 billion a year ago.

Assets under management at the wealth business, including such holdings as St James’s Place, Invista Real Estate, Private and International Banking and other segments, stood at £181.5 billion at the end of June, down from £192.3 billion a year earlier, as market movements and attrition of insurance funds eroded the AuM figure.

The cost/income ratio of the wealth business stood at 70.7 per cent at the end of 30 June, down from 73.4 per cent a year before.

“Wealth provides strong growth opportunities for the group and through deepening the relationships with existing group clients alongside targeted customer acquisition, its goal is to be recognised as the primary wealth advisor to UK mass affluent, affluent and high net worth customers together with UK expatriates and others with UK connections,” the bank said in a statement.

“We aim to increase our market share in UK and international wealth primarily through growing the amount of customer deposits and funds under management that we manage on behalf of franchise customers, whilst improving margins and operating efficiency,” it continued.

Throughout the whole Lloyds Banking Group, the firm logged an underlying profit of £1.064 billion in the six months to 30 June, up from £349 million a year ago. The banking net interest margin was 1.93 per cent from 2.12 per cent; the bank made a statutory pre-tax loss of £439 million, down from £3.251 billion a year ago.

LIBOR

The UK bank is one of more than a dozen banks that is being investigated by the authorities in the UK for allegedly helping to rig interbank interest rates known as LIBOR. 

In comments reported today by Reuters and others, George Culumer, finance director, said: "We are still part of an ongoing investigation and until the regulator is satisfied that that investigation is complete there is no point at this stage in thinking about or putting down a number."

Lloyds has said it is investigating its LIBOR practices and will issue findings when all investigations by regulators are complete. 

There has been a storm of speculation on the potential fallout from the LIBOR-rigging affair, such as large class-action lawsuits from disgruntled investors and criminal prosecutions. The issue has also led to calls for changes in how the inter-bank interest rate benchmark is set, or whether market participants should pay such regard to this benchmark in the first place.