Lloyds Bank hit by £550 million PPI charge, pretax profits fall

Business

FILE PHOTO: A woman uses a cash machine at a Lloyds Bank branch in central London, Britain February 25, 2016. REUTERS/Paul Hackett/File Photo

LONDON (Reuters) – Britain’s biggest mortgage lender Lloyds Banking Group (LLOY.L) posted weaker-than-expected pretax profits on Wednesday, as a further 550 million pound ($668.9 million) provision to meet claims for mis-sold insurance to consumers weighed on earnings.

The bank posted pretax profits of 2.9 billion pounds for the first half of the year, below forecasts of 3.45 billion pounds according to a company-provided average of analyst forecasts.

The figure was down 7% from 3.12 billion pounds for the same period the previous year.

Lloyds said exceptional charges, including PPI, would knock its capital build for 2019 to the lower end of its 170 to 200 basis points range.

Without one-off costs, Lloyds matched analyst forecasts for underlying profits, at 4.2 billion pounds.

Reporting by Iain Withers and Lawrence White, editing by Sinead Cruise

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