Lloyds seeking to double profitability in 2021

Lloyds (LON:LLOY) has announced its pre-tax profit dropped by 72% over 2020.  

The banking giant’s profit before tax fell to £1.2bn from £4.4bn the year before.

However, Lloyds’ Q4 performance was better than expected, with the bank reporting a £792m pre-tax profit for this period. This figure surpassed average analyst forecasts of £471m. 

The bank paid a £4.2bn impairment charge for loans that are expected not to be repaid due to the pandemic. 

In line with its rivals – HSBC, Natwest and Barclays – Lloyds will reinstate its dividend of 0.5p per share having been blocked last year by the Bank of England 

Lloyds shares are up by 2.3% early on Wednesday morning to 40.15p.

Lloyds will look to expand its insurance and wealth division, as the bank seeks to double its profitability over the coming year.  

António Horta-Osório, chief executive at Lloyds Bank, who will be succeeded by Charlie Nunn in August, commented on both the year gone and the bank’s future prospects. 

“The impact of the coronavirus pandemic on the people, businesses and communities in the UK and around the world in 2020 has been profound. We remain absolutely focused on working together with all of our stakeholders to support our customers and ensure a sustainable recovery,” said Hort-Osório

“Looking forward, significant uncertainties remain, specifically relating to the coronavirus pandemic and the speed and efficacy of the vaccination programme in the UK and around the world. I remain confident that the Group’s clear purpose, unique business model, significant competitive advantages and the customer focused evolution of our strategy we have announced will ensure that the Group is able to Help Britain Recover and in so doing, help transition to a sustainable economy.”

Lloyds is the last of the major banks to announce results over the last week, with all of them surpassing analyst expectations.