Lloyds Banking Group profits double to £1.3bn, avoiding a Brexit dip

The UK’s biggest mortgage lender set aside £350m during the quarter to cover the costs of the long-running PPI scandal

Underlying profits remain steady at £2.1bn (Reuters)

Lloyds Banking Group’s profits have avoided an expected Brexit dip, doubling to £1.3bn for the first three months of 2017 compared with the same period last year.

The UK’s biggest mortgage lender set aside £350m during the quarter to cover the costs of the long-running PPI scandal, which has now cost it more than £17bn. It also earmarked £100m for the HBOS scandal, to compensate victims whose businesses were crippled by two former bankers.

“These results continue to demonstrate the strength of our customer focused, simple and low risk business model,” Antonio Horta Osorio, chief executive of Lloyds Banking Group, said in a statement.

Underlying profits remained steady at £2.1bn.

The results announcement looks set to be Lloyds’ last before it returns to full private ownership.

Last week, the Government finally recovered the £20.3bn of taxpayers’ money it pumped into Lloyds to save it from collapse in 2008 during the financial crisis. The Government now owns less than 2 per cent of Lloyds shares and is expected to offload its remaining stake in the coming weeks.

Lloyds’ fortunes contrast sharply with those of fellow bailed out bank RBS, which is still 72 per cent Government-owned.

Last week, Chancellor Philip Hammond admitted that taxpayers were likely to make a loss on £45bn of shares it purchased to save RBS. “We have to live in the real world,” he told MPs.

Earlier this month, Lloyds announced the locations of 100 branch closures that will lead to 325 job losses.