Update Ahead of 2013 FY Results Announcement

Ahead of its 2013 Full Year results announcement, to be released on 13 February 2014, Lloyds Banking Group (the Group) is today providing an update on its progress in 2013, Payment Protection Insurance (PPI), and its dividend policy.

In these results, the Group expects to report substantial progress on its strategic plan, a Group underlying profit of £6.2 billion for 2013, ahead of analyst consensus expectations and more than double that in 2012, a Group 2013 full year net interest margin of 2.12 per cent, and core loan growth of 3 per cent. The Group also expects to report a small statutory profit before tax for the 2013 financial year, and an estimated pro-forma fully loaded common equity tier 1 ratio of 10.3 per cent at 31 December 2013, in line with guidance.

These results and capital position reflect a further provision taken in the fourth quarter of £1.8 billion for legacy PPI business, and a further provision of £130 million relating to the sale of interest rate hedging products to certain small and medium-sized businesses. The PPI provision increase is principally based on the Group's revised expectations for complaint volumes, uphold rates, and related administrative costs.

In the second half of 2013, the Group commenced discussions with the Prudential Regulatory Authority (PRA) on the timetable and conditions for resuming dividend payments. Given the progress the Group has made in substantially strengthening its capital position and improving its financial performance, the PRA has now confirmed that it will consider the Group's applications to make dividend payments in line with its normal procedures for other banks.

In the light of this, and subject to a return to sustainable profitability and there being no major unexpected changes in the Group's business outlook or regulatory requirements, the Board expects that it will apply to the PRA in the second half of 2014 to restart dividend payments, commencing at a modest level. The Board expects thereafter to have a progressive dividend policy with the aim of moving, over the medium term, to a dividend payout ratio of at least 50 per cent of sustainable earnings.

In addition, given the Group's improved capital strength, the Board will no longer issue new ordinary shares to fund discretionary payments on hybrid capital securities.

The Group can also confirm that, following the statements made by the Chancellor in his Mansion House speech and in the Autumn Statement, preparatory work including the preparation of certain documents required for a possible future sale of shares in Lloyds Banking Group to the public, has commenced.

Commenting on the update, António Horta-Osório, Group Chief Executive, said: "Over the last three years we have reshaped, simplified and strengthened the business to create a low-risk efficient Retail and Commercial bank that is focused on our customers and on helping Britain prosper. Our significant progress in delivering sustainable improvements in our capital position and our profitability, despite legacy issues, is testament to the strength of our business model and the commitment of our people, and has enabled the UK government to start to return the bank to full private ownership.

We expect to apply in the second half of 2014 to restart dividend payments and to deliver progressive and sustainable payments to shareholders thereafter. This will be another important step in our journey to rebuild trust and confidence in our Group."


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04-Feb-14 Lloyds Banking Group
LLOY Societe Generale Buy 79.53p 86.00p 86.00p Reiteration

04-Feb-14 Lloyds Banking Group
LLOY Citigroup Neutral 79.53p - - Reiteration

04-Feb-14 Lloyds Banking Group
LLOY JP Morgan Cazenove Neutral 79.53p 84.00p 84.00p Reiteration

04-Feb-14 Lloyds Banking Group
LLOY Deutsche Buy 79.53p 90.00p 90.00p Reiteration

========



BARCs is also flavour of the moment.

StockMarketWire.com
Lloyds Banking Group said it significantly improved its financial performance in the year to end-December 2013, with group underlying profit more than double at £6.2bn and a statutory profit before tax of £415m.

Return on risk-weighted assets increased to 2.14 per cent (2012: 0.77 per cent).

Underlying income of £18,805 million was up 2 per cent.

Banking net interest margin increased 19 basis points to 2.12 per cent, and to 2.29 per cent in the fourth quarter.

Costs were reduced by 5 per cent to £9,635 million.

Credit quality continues to improve: impairment charge reduced by 47 per cent to £3,004 million; impairment charge as a percentage of average advances improved to 0.57 per cent (2012: 1.02 per cent).

Core underlying profit increased by 24 per cent to £7,574 million.

Core return on risk-weighted assets increased from 2.54 per cent in 2012 to 3.26 per cent in 2013.

Statutory profit before tax of £415 million; tangible net asset value per share of 48.5p.

Statutory profit before tax of £415 million (2012: loss of £606 million) included charge for legacy PPI business of £3,050 million.

Tangible net asset value per share at 31 December 2013 48.5p (31 Dec 2012: 51.9p); includes loss on capital accretive non-core disposals, deferred tax write-offs, adverse reserve movements, and legacy charges.

2013 Results

Espirito Santo Execution Noble Sell 80.22 70.00 70.00 Reiterates

Numis Add 80.22 97.00 97.00 Reiterates

Canaccord Genuity Hold 80.06 83.53 70.00 70.00 Reiterates

Investec Hold 79.99 83.53 85.00 85.00 Reiterates

Credit Suisse Neutral 80.06 83.53 68.00 68.00 Reiterates

Some difference of opinion there Skinny.
....I suppose the rest will be coming out with their 'guesses' soon.

As ever!

much as I abhor the banks total disdain for their customers and it would seem, their shareholders; I don't think we can afford to ignore the further upside potential here over the next couple of years.

To that end I've bought a few more this morning!

Added some myself skinny!
You never know - they may come good in the end.

Beaufort Securities Hold 81.44 81.32 - - Retains

JP Morgan Cazenove Overweight 81.44 81.32 84.00 95.00 Upgrades

Deutsche Bank Buy 81.44 81.32 90.00 90.00 Reiterates

Societe Generale Buy 81.19 81.32 86.00 94.00 Reiterates

LLOYDS BANKING GROUP ANNOUNCES WILL SAMUEL AS CHAIRMAN OF TSB

Lloyds Banking Group announces the appointment of Will Samuel as the Chairman of TSB Bank plc ("TSB"). Will is currently Chairman at the Ecclesiastical Insurance Group Plc and Chairman of Howden Joinery Group plc. Previously he was a Director of Schroders plc, a Vice Chairman of Investment Banking at Citigroup Europe, a Senior Adviser at Lazard & Co Ltd and a Senior Adviser to the Prudential Regulatory Authority. He will join the TSB Bank Board immediately.

The creation of TSB followed a ruling by the European Commission in 2009 by which Lloyds Banking Group agreed to the divestment of a retail banking business with over 600 branches. On 9 September 2013, TSB was launched across Great Britain, bringing a new competitor to the market offering current accounts, savings, mortgages, insurance and loans as well as supporting small businesses. Lloyds Banking Group has stated its intention to float the TSB business through an Initial Public Offering during 2014.

Lloyds Banking Group Chairman Sir Winfried Bischoff said: "This is a great appointment for Lloyds and for TSB. Will brings a wealth of experience to the role and is well-regarded by the market and across the financial services industry. He is a key hire and will be instrumental in building TSB's independent future as a challenger to the other high street banks."

Will Samuel said: "I am delighted to be appointed as Chairman of TSB. The bank has an exciting future ahead as we move to independence and establish ourselves as the home of local banking."

As per post #4609:
"StockMarketWire.com
Equity research analysts at JP Morgan Cazenove have upgraded their recommendation on Lloyds Banking Group (LON:LLOY) to "overweight" from "neutral" following the negative market reaction to yesterday's final results announcement. The broker stated that, given market expectations around legacy costs, NAV growth and capital returns have been reset, there is now scope for the shares to react favourably to positive news flow over the medium term. Analysts have, therefore, increased their price target to 95 pence per share (from 84 pence) which implies around 17 per cent upside potential. Earnings per share estimates have been increased to 7.86 pence (from 7.64 pence) for fiscal year 2015 and to 8.68 pence (from 8.37 pence) for 2016. "

SALE OF A PORTFOLIO OF EUROPEAN COMMERCIAL REAL ESTATE LOANS

Lloyds Banking Group plc (Group) announces today that it has agreed the sale of a portfolio of European commercial real estate loans to MELF S.à r.l, an entity affiliated with Marathon Asset Management LP, for a cash consideration of approximately €280 million, or approximately £235 million at current exchange rates. The transaction is part of the Group's strategy to reduce its non-core run-off portfolio.

The gross assets subject to the transaction are £494 million and in the year to 31 December 2013 incurred a loss of £(54) million. The sale proceeds will be used for general corporate purposes and the transaction is not expected to have a material effect on the Group, including on its capital position, due to existing provisions taken against these assets.

The transaction is expected to complete in the second quarter of 2014.

- END -

Investec Buy 78.51 77.37 85.00 85.00 Upgrades

StockMarketWire.com
Investec has upgraded its recommendation on Lloyds Banking Group (LON:LLOY) to "buy" from "hold", arguing that "it is safe to go back in the water". The broker reckons that the recent pull-back in the share price (the shares are down by around 10 per cent over the past 10 weeks) has presented investors with the opportunity to get hold of a stock with the ideal combination of reasonable value and low-risk. Analysts have left their price target unchanged at 85 pence per share which implies a forecast total return of 12.2 per cent. Separately, Barclays Capital reaffirmed its "overweight" investment rating (price target increased to 88 pence per share from 85 pence) in a note to clients, on Friday. The broker said: "Lloyds shares are not cheap at 1.6x tangible book, but with a relatively clear line of sight to a 15%+ RoTE we believe that they still offer good value."

Further to its announcement on 25 March 2014, UKFI announces the successful completion of the disposal of part of HM Treasury's shareholding in Lloyds Banking Group plc. The disposal was effected by way of a Placing of ordinary shares by way of an accelerated bookbuilding process to institutional investors.

In summary, following settlement of the Placing which will take place on 31 March 2014:

● The shareholding of HM Treasury will be reduced from 23,326,529,533ordinary shares, representing approximately 32.7% of the ordinary share capital of the Company, to 17,771,118,604 ordinary shares, representing approximately 24.9% of the ordinary share capital.

● Accordingly, the overall size of HM Treasury's shareholding will be reduced by 23.8%.

● The Placing Price was 75.5 pence per Placing Share. As a result, the proceeds from the sale of the Placing Shares will be £4.2bn.

● Bank of America Merrill Lynch, J.P. Morgan Cazenove (who have also been acting as UKFI's privatisation strategy adviser), Morgan Stanley Securities Limited and UBS Limited were appointed to act as Bookrunners in connection with the Placing.

● UKFI and HM Treasury have undertaken to the Bookrunners not to sell further shares in the Company for a period of 90 calendar days following the completion of the Placing without the prior written consent of a majority (by participation) of the Bookrunners.

"The Placing Price was 75.5 pence per Placing Share." Nice one - not!!

I suppose the positive side of that is we can all buy LLOY at under 75p now! ;o(

And have done - well just over actually.

Investec Buy 79.11 79.11 85.00 85.00 Reiterates

Sub 75p again! Not performing as hoped atm.

Certainly not especially as I bought more at 75.5
Was hoping for a bit of a recovery now after the placing but that looks like it will have to wait for later this year.