My post on 14th December 2015

Early days yet I know, but if weakness persists into 2016 I wonder if the £2B sale will go ahead.
2517

An interesting graph at the top of this post. Just bought and hopefully the upside will replicate the downside shown..............Time will tell!

Two final divis and an interim in the next 14 months should ease the pain!

Jefferies International today reaffirms its buy investment rating on Lloyds Banking Group PLC ORD (LON:LLOY) and cut its price target to 101p (from 104p).

Trend is still down which is disappointing.

Well apart from my holding from down at 40p from years ago I though 73p was a good entry. Hey what do I know?
All the banks starting to look way oversold to me. Took some BARC today.

I believe your right CC , same with BARC..

As the market is forecast to start lower today,we might be getting to a new good entry point imo. HeyHo we shall see but I shall soon start buying for long investment periods rather than trading this one.

I think my buy at 73 has already turned into a long term investment

....all mine turned that way some time ago ;-(

In fact nearly everything in my portfolio apart from a few builders and trades placed this week are now a long term hold. Nothing a 5% rally on FTSE wouldn't fix but frustrating nevertheless

Same here , lloy / barc , i may average down with the banks and just sit on them.

So far so good with this as long as the recovery continues.

I was looking forward to a bit more interest in Lloyds today but it does seem that the malaise of the market has taken over...once again.
But if AHO is to get a £800K bonus then there is hope of a decent divi for the shareholders...fingers crossed on that.

Wed 24 Feb 2016

(ShareCast News) - Lloyds Banking Group is expected to report a sharp decline in full year profit on Thursday as the company sets aside further provisions for the mis-selling of payment protection insurance (PPI).
UBS estimates that the bank will book a provision for PPI of £2.9bn in the fourth quarter. The compensation for the PPI fund totals around £14bn at the moment. Lloyds is still setting cash aside ahead of the government's deadline of October 2018 to claim mis-sold PPI.

"At a stated level we forecast a loss before tax of £1.59bn for the quarter and pre-tax profit of £560m for the year (2014 full year: £1.8bn), driven mostly by our assumption that Lloyds will book a fourth quarter provision for PPI of £2.9bn," UBS analyst Jason Napier said.

"Assuming that in fourth quarter 2015 PPI refunds continued at the same rate as in the third quarter, this provision would be sufficient to take refund cover to 21 months, in line with our expectation of an Financial Conduct Authority-agreed mid 2018 deadline for PPI claims."

At an underlying level, UBS has forecast full year profit before tax of £1.65bn in 2015, compared to £7.8bn the prior year.

The lender has already reported a decline in total income in the last quarter as the commercial division suffered challenging trading conditions.

In January the government decided to postpone the next sale of its stake in the bank, with Chancellor George Osborne blaming "market turbulence". The government has tried to attract retail investors with a 5% discount to market value if the share price reaches 73.6p. However, shares were sitting at 62.30p each at 1330 GMT.

Osborne told BBC News that "now is not the right time" and that he would not give the go-ahead until the markets had calmed.

The government said in October the sale of its holding, which was expected to be completed in spring, would raise at least £2bn to reduce national debt by selling shares to private investors.

Robustness was a key theme in the annual financials for Lloyds Banking Group, with the company reporting rises in underlying income and underlying earnings for the 2015 calendar year and recommending a final ordinary dividend of 1.5p per share plus a special dividend of 0.5p per share. The bank saw underlying profit increase 5% to £8.1bn during the year, with an underlying return on equity of 15% - up from 13.6%, with statutory profit before tax down to £1.6bn from 2014's £1.8bn due to increased PPI charges.

Lloyds to pay special dividend as profits rise

On that subject, my understanding is that dividends will not be taxed up to a threshold of £5k from april 2016, but will also not incur a 10% tax at source. Is that about right for normal tax payers?

That's about the strength of it - Dividend Allowance factsheet

Morgan Stanley comment:
"While Q4 PBT is -8% light vs consensus at £1.76bn on lower other income / higher impairment , the 0.5p special dividend and PPI commentary appear to show the normalisation process for Lloyds is almost complete and that future underlying returns will accrue to shareholders which we think is key for the stock performance. Lloyds indicate that the extra £2.1bn PPI provision should be sufficient, that margin will expand to 2.70% in 2016 (+0.07% y/y) somewhat allaying fears of a squeeze from competition / low rates.
Overall slightly soft set of underlying Q4 earnings with underlying PBT of £1.76bn, 8% below consensus. Revenues 2% light despite solid NIM print at 2.64% in Q4 (flat q/q) and steady average interest earning assets as noninterest income was impacted by disposals and run-off as well as weather related insurance claims (c.£60 million). Costs were in line with consensus but impairments came in ahead of consensus at c.£230 million or 22bps.
PPI charge of £2.1 billion for the quarter reflects time bar and Plevin proposals and takes the total provided to £16 billion. The unutilised provision of £3.5 billion is expected to be sufficient to cover an average of c.10,000 complaints per week with associated admin costs (vs. 8,000 complaints per week in 2015). 4Q results also included £302 million of provisions for packaged bank accounts and “a number of other product rectifications”.
CET1 ratio 13% pro forma and TNAV 52.3p missed MSe due to higher than expected dividends. Full year dividends totalled 2p, with 1.5p ordinary and 0.5p special (in line with consensus but ahead of MSe) taking CET1 ratio down to 13% pro forma for 20bps benfit from an insurance dividend relating to 2015 to paid in 2016. RWAs £233 billion, -1% q/q. TNAV at year end was 52.3p (53.8p pre dividend) and company flagging improvement to 55.6p as at 19 February.
Outlook reassuring on NIM and asset quality, though cost:income / RORE targets pushed out: NIM guidance of 2.70% for FY16 +0.07% y/y is ahead of consensus (2.63%) and should significantly allay market fears. Asset quality ratio is now guided to below 20bps for FY16 (vs cons 19bps) which is in-line. The push out of the cost: income target (now 45% only expected in 2019) could be indicative of lower than expected other operating income, so we expect to see more explanation here on the call. Also given an underlying RORE of 15% in 2015 investors will naturally query why the 13.5%-15% target may not be met on a stat basis in 2017. The capital generation target is improved to 2% annum (was 1.5-2%) indicating c.£4.5bn of capital flow year (based on £223bn of RWAs) or c.10% of market cap which seems rather appealing."

Investec comment:
"Price: 62.2p | Target: Under Review | Rec: Buy
Once again we see Lloyds’ earnings recovery story as merely “deferred” rather than “cancelled”. A Q4 2015 Reported Loss of £0.5bn primarily reflects an unsurprising £2.1bn PPI top-up, while the underlying result was, we think, broadly in line with expectations. But with a proforma CET1 ratio of 13.0% Lloyds has declared an FY15 dividend of 2.25p plus a 0.5p “special”. Outlook comments should trigger consensus upgrades; 2016 NIM is guided to 2.70% (vs 2.63% in 2015). On 1.2x 2015 tNAV (52.3p) for 2017e RoTE of 12.2%. BUY.
For us, the key news is the actual dividend and the outlook for capital accretion and dividends. The 2.75p to be paid for 2015 represents a 4.4% yield. Lloyds is a ‘low/no growth’ bank, but capital accretion is now guided to 2% p.a. (previously 1.5%), giving us increased confidence in the validity of our existing 5p 2017e dividend forecast – an improbably high implied 2017e dividend yield of 8%. We expect a material upward share price correction to deal with that!
We regard the underlying performance as broadly “in line” with a better mix than anticipated. The Q4 2015 Underlying PBT of £1.8bn was 2% below our own £1.8bn forecast. Technically, this is an 8% miss against company-compiled consensus of £1.9bn, but that number looks somewhat “stale”, and can be ignored in our view. Against our forecasts, we see Q4 2015 revenues of £4.3bn (+5% QoQ) as a £100m (2%) beat, offset by misses of £76m (3%) on costs and £67m (41%) on impairments, hence the small £43m (2%) miss in U/L PBT.
Of much greater significance for the share price outlook is, we think, the transition from capital build to capital return. Lloyds thinks its £16bn cumulative PPI provision will be sufficient, albeit we still assume a further c.£1bn charge. However, Lloyds has “corrected” its peculiar 30% medium-term tax guidance to 27%, and this enhances expected capital build. It is a ‘low/no growth’ bank but, in our view, offers a very high and clearly visible capital return story.
Buy rec reaffirmed. Detailed forecasts and 78p TP are placed under review."