UPDATE: Lloyds Posts GBP4 Billion 1st Half Pro-Forma Loss From Bad Loans





(Adds detail.)
By Margot Patrick

Of DOW JONES NEWSWIRES

LONDON -(Dow Jones)- Lloyds Banking Group PLC (LYG) Wednesday reported that loan impairments rose more than five-fold in the first six months of the year, as the deepest U.K. downturn in decades made it harder for mortgage borrowers and companies to repay debt.

But Lloyds said it sees the second half as "tough but manageable" and that it expects loan impairment charges to come down significantly from GBP13.4 billion in the first half.

Reporting a first-half pro-forma pretax loss of GBP3.96 billion - lower than analyst expectations of around GBP5.24 billion - Chief Executive Eric Daniels said the group's performance should improve from the second half as the loan impairments decline, and that the bank is "well positioned to outperform in the medium term."

The GBP13.4 billion set aside by Lloyds to cover loan losses compared with GBP2.5 billion in the first half of 2008, with the bulk of the problem loans coming from Lloyds' HBOS division.

The bank made a GBP3.12 billion net loss, compared to a GBP1.95 billion net profit in the same 2008 period.

The comparable figures for the first half of 2008 were made on a pro-forma basis compiling the separate performance of Lloyds and HBOS in the period.

Lloyds agreed to buy HBOS last year at the height of the financial crisis and within weeks needed a GBP17 billion bailout that resulted in the U.K. government taking a 43% stake in its shares.

Before making the acquisition, Lloyds was among the few banks to carry a triple-A credit rating and had been lauded for focusing on traditional lending and deposits while its peers loaded up on risky assets.

The bank said Wednesday that the government submitted a restructuring plan for Lloyds to the European Commission on July 15. The Commission has indicated that a condition of approving the state aid received by Lloyds could be the disposal of some of its operations.

Shares in Lloyds closed down 2 pence Tuesday at 84 pence. The stock has lost about 10% since the start of the year but has regained 70% since hitting a low of 25 pence in March.

Company Web site: http://www.lloydsbankinggroup.com

-By Margot Patrick, Dow Jones Newswires; +44 (0)20 7842 9451; margot.patrick@dowjones.com

Buy whist its still under a 1

can anyone tell me if a divi will be payed on these results

Douggie - "However, it is not the Board's intention to pay a dividend on ordinary shares in respect of 2009. "

thanks skinny....;o/

I would have been amazed if they had. However, as HMG are a 43% shareholder, anything is possible. As divi's are taxed at source, the government would have received the tax & the divi.
Just for once in my life, taking up the rights issue has paid off handsomely, so divi not too important in this case.

05-Aug-09 Lloyds Banking Group LLOY Shore Capital Hold 95.00p - - Reiteration
05-Aug-09 Lloyds Banking Group LLOY Keefe, Bruyette & Woods Underperform 95.00p - - Reiteration
05-Aug-09 Lloyds Banking Group LLOY NCB Sell 95.00p - - Reiteration

Well that's agreed then :-)

Be back nearer 70p in two weeks after it all sinks in, and the doom and gloom brigade start waffling on. Out for now, back in, when the dust settles around 75p

You may not see that price again ,unless this trades like BARC did for a few months ,,all over the place...

I doubt we going to the see the 70s again - next resistance is 100 mark -

Before the HBOS fiasco,Lloyds was one of UKs best banks,so the ability to recover makes it a reasonable bet.
And look at the trading volume.-257 million.

marni are you standing on the ledge next to sandy chen?

sandt chen ananysis sounds good......accounting tricks making balance sheet look better than reality.........lloy might be ok in past but its got dreadful halifax property mess on its hands now and its takes years to sort out

marni so you are still a shorter, well prepare to lose a lot of money.

i dont short.......just stating that lloy mainly through halifax is knackered.

depends what u mean by a lot of money......i only put in fairly small amounts on shares that i like the look of anyway

if u read my comments elsewhere u will know that i dont short or steal

i'd love to short the valuation of peoples houses but i cant

Good volume today.

marni you should realise that we all need a roof over our heads whether owned or rented,at the moment demand has fallen due to economic uncertainty created by politicians and "economists". Demand will rise next year and the mortgage business will pick up, and thus property values will gradually improve. Next year anal...ysts will begin to understand that LLOY is in an almost unique position by being the largest retail bank in UK by far. Retail banking is the most profitable banking activity as long as you don't get involved in sub prime lending. LLOY will clean up what is left of HBOS and earnings will rocket in 2011. Today LLOY's market cap is less than half it's nav.

Hate to disagree, but the reality is that adding one great business to one failed business gives two failed businesses. LLOY may soon consider itself the No-1 in Retail banking, but it has too many Branches - and can't close that many, since they don't have enough teller-capacity to accommodate two-branch customer-levels, er IMHO.

The answer is on-line Banking and this means they are competing with themselves - cue a new Bank with good interest-rates and pushing the cashless society ( so no cash-machines). That is the future of Banking and already it is here ( although rather quiet, I'll agree).

If LLOY-gp was operating in isolation about 20-years ago then this takeover IS a great deal, but I think this World Order will change everything and folk will adapt to the next-generation of Banking . . . so LLOY-gp has no customer loyalty to play with (so to speak), since interest-rate is everything
---(The same goes for Mortgages, naturally)

Now the bad news - the liability of HBOS will haunt LLOY-gp for many years and this can't be shunted into "Off-B-S" accounts for ever . . . . . (can I say that?).

Old-LLOY- Directors have created a child of satan - and a nightmare for original shareholders. I am one and sold at 60p believing this Deal was the worst any Director has made in 50-years. I didn't participate in the 38p jamboree of dilutiuon.

LLOY was a respected friend, not any more, IMHO.

The rise today - oh great, "markets say OK" - well the 10% rise was less than Carpetright's +15% and I'm not sure they are about to sell shed-loads of carpets....
Good luck.