Financial Performance and Key Metrics - The group reported a statutory profit after tax of £3.3 billion for the first nine months of the year, with a return on tangible equity (ROTE) of 11.9% [5][17] - Excluding the motor provision, ROTE was 14.6%, and the full-year expectation for ROTE is around 12% or 14% excluding motor [6][18] - Year-to-date net income reached £13.6 billion, a 6% increase year-on-year, driven by growth in net interest income and a 9% rise in other operating income [6][11] - Operating costs for the year-to-date were £7.2 billion, up 3% year-on-year, in line with expectations [7][13] - The closing CET1 ratio stood at 13.8%, reflecting strong capital generation of 110 basis points year-to-date [19] Business Line Performance - Group lending balances increased to £477 billion, up £18 billion or 4% year-to-date, with retail lending growing by £5.1 billion [8][9] - Year-to-date deposits grew by £14 billion or 3%, with a quarterly increase of £2.8 billion in Q3 [9] - Net interest income for the first nine months was £10.1 billion, up 6% year-on-year, with a Q3 margin of 306 basis points [10][11] - Other operating income (OOI) reached £4.5 billion year-to-date, up 9% year-on-year, with Q3 OOI at £1.6 billion [11][12] Market Data and Key Metrics - The retail business saw growth across cards, loans, and motor businesses, while commercial lending balances increased by £1.3 billion in Q3 [8][9] - The insurance, pensions, and investments sectors experienced steady growth, with approximately £3.3 billion of open book net new money year-to-date [9] Company Strategy and Industry Competition - The company completed the acquisition of Schroders Personal Wealth, now rebranded as Lloyds Wealth, which will enhance its wealth management capabilities [4][35] - Significant advancements were made in the digital asset strategy, including partnerships to deliver tokenized deposits and FX derivatives trades [5][41] - The company aims to integrate Lloyds Wealth into its broader offerings, enhancing customer propositions and driving shareholder value [35][39] Management Commentary on Operating Environment and Future Outlook - Management expressed confidence in achieving 2026 guidance despite the recent motor provision charge, indicating strong underlying business performance [4][20] - The company anticipates continued growth in net interest income and margin expansion through 2026, driven by structural hedge contributions and lending growth [27][29] - Management acknowledged potential headwinds from mortgage refinancing but maintained that guidance for net interest income remains unchanged [54] Other Important Information - An additional £800 million charge was taken for potential motor commission remediation costs, bringing total provisions to £1.95 billion [4][15] - The company is committed to maintaining cost discipline while investing in strategic growth areas [13][20] Q&A Session Summary Question: Regarding motor finance provisions and potential FCA outcomes - Management indicated that the current provision of £1.95 billion is based on scenario analysis and that the FCA's proposals are heavily weighted in their provisioning [25][26] Question: Expectations for net interest margin (NIM) growth - Management expects NIM to increase in Q4, driven by structural hedge contributions, and anticipates continued margin expansion into 2026 [27][29] Question: Insights on the wealth management strategy and potential inorganic growth - Management expressed satisfaction with the acquisition of Lloyds Wealth and emphasized focusing on organic growth and integration before considering further acquisitions [35][39] Question: Updates on non-banking funding costs and other operating income trends - Non-banking net interest income is running about 10% ahead of last year, with growth driven primarily by volumes rather than rates [71][72] - Other operating income trends show divergence, with retail performing well while insurance appears to be tapering off [70][72]

Financial Performance - The company reported a statutory profit after tax of GBP 3.3 billion for the first nine months of the year, with a return on tangible equity (ROTE) of 11.9% [5][6] - Excluding the motor provision, ROTE was 14.6%, and the company expects ROTE for the full year to be around 12% or approximately 14% excluding motor [6][18] - Year-to-date net income reached GBP 13.6 billion, a 6% increase compared to the previous year, driven by growth in net interest income and a 9% rise in other operating income [6][10] Business Line Performance - Group lending balances increased to GBP 477 billion, up GBP 18 billion or 4% year-to-date, with retail lending growing by GBP 5.1 billion [8][9] - Year-to-date deposits grew by GBP 14 billion or 3%, with a quarter-on-quarter increase of GBP 2.8 billion in Q3 [9][10] - Other operating income for the year-to-date was GBP 4.5 billion, up 9% year-on-year, with Q3 OOI at GBP 1.6 billion, reflecting growth in motor and investments [11][12] Market Data - The company maintained a net interest margin of 3.06% in Q3, with expectations for continued growth in net interest income for the full year to be around GBP 13.6 billion [6][10] - The asset quality ratio is expected to be around 20 basis points for the full year, reflecting strong credit performance [7][16] Strategic Developments - The company completed the acquisition of Schroders Personal Wealth, now rebranded as Lloyds Wealth, which will enhance its wealth management capabilities [4][36] - Significant progress has been made in the digital asset strategy, including partnerships to deliver tokenized deposits and FX derivatives trades [5][41] Management Commentary - Management expressed confidence in the company's ability to meet its 2026 guidance despite the additional motor provision charge [4][21] - The company remains focused on creating value for customers and stakeholders through targeted growth and improved propositions [3][21] Other Important Information - The company has taken an additional GBP 800 million charge related to motor commissions, bringing the total provision to GBP 1.95 billion [4][15] - Operating costs year-to-date were GBP 7.2 billion, up 3% year-on-year, with expectations to meet full-year guidance of GBP 9.7 billion [13][14] Q&A Session Summary Question: Regarding the motor finance provision and potential top-up - Management indicated that the current provision of GBP 1.95 billion is based on scenario analysis and reflects the adverse end of expected outcomes [25][26] Question: Expectations for net interest margin (NIM) growth - Management expects NIM to increase in Q4, driven by structural hedge contributions, and anticipates continued margin expansion into 2026 [27][29] Question: Insights on the wealth management strategy and potential inorganic growth - Management emphasized the importance of integrating Lloyds Wealth into existing offerings and indicated a focus on organic growth following the acquisition [36][40] Question: Update on non-banking funding costs and other operating income trends - Management noted that non-banking net interest income is running about 10% ahead of last year, driven primarily by volume growth rather than rate increases [74][75]

Financial Performance and Key Metrics - The group reported a statutory profit after tax of £3.3 billion for the first nine months of 2025, with a return on tangible equity (ROTE) of 11.9% [5][6] - Excluding the motor provision, ROTE was 14.6%, and the full-year ROTE is now expected to be around 12% or 14% excluding motor [6][17] - Year-to-date net income reached £13.6 billion, a 6% increase compared to the previous year, driven by growth in net interest income and a 9% rise in other operating income [6][12] - Operating costs for the year-to-date were £7.2 billion, up 3% year-on-year, in line with expectations [7][14] - The closing CET1 ratio stood at 13.8%, reflecting strong capital generation of 110 basis points year-to-date [19] Business Line Performance - Group lending balances increased to £477 billion, up £18 billion or 4% year-to-date, with retail lending growing by £5.1 billion [9][10] - Year-to-date deposits grew by £14 billion or 3%, with a quarterly increase of £2.8 billion [10] - Net interest income for the first nine months was £10.1 billion, up 6% year-on-year, with a net interest margin of 3.06% [11][12] - Other operating income (OOI) reached £4.5 billion year-to-date, up 9% year-on-year, with Q3 OOI at £1.6 billion, a 3% increase from Q2 [12][68] Market Data and Key Indicators - The retail business saw continued growth across cards, loans, and motor businesses, while commercial lending balances increased by £1.3 billion in Q3 [9][10] - The insurance, pensions, and investments segment experienced steady growth, with approximately £3.3 billion of open book net new money year-to-date [10] Company Strategy and Industry Competition - The company completed the acquisition of Schroders Personal Wealth, now rebranded as Lloyds Wealth, which will enhance its wealth management capabilities [4][33] - Significant advancements were made in the digital asset strategy, including partnerships to deliver tokenized deposits and FX derivatives trades [5][39] - The company aims to integrate Lloyds Wealth into its broader offerings, enhancing customer propositions and driving shareholder value [34][36] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the underlying business performance despite the additional £800 million charge related to motor commissions [4][19] - The company anticipates continued growth in net interest income and margin expansion into 2026, driven by structural hedge contributions and lending growth [26][27] - The outlook for asset quality remains strong, with an expected asset quality ratio of around 20 basis points for the full year [16] Other Important Information - The company maintained strong cost discipline, with year-to-date operating costs in line with expectations, and plans to meet its full-year guidance [14][19] - The total provision for motor finance remediation now stands at £1.95 billion, reflecting the adverse outcomes from FCA proposals [15][44] Q&A Session Summary Question: Regarding motor finance provisions and potential top-ups - Management indicated that the current provision of £1.95 billion is a best estimate and that the FCA's proposals are heavily weighted in their scenario analysis, suggesting limited movement in overall provisioning [22][24] Question: Expectations for net interest margin (NIM) growth - Management expects NIM to continue to grow in Q4, driven by structural hedge contributions, and anticipates continued margin expansion into 2026 [26][27] Question: Insights on the wealth management strategy post-acquisition - The acquisition of Lloyds Wealth is seen as a significant step forward, with plans to integrate it into existing customer propositions and enhance advisory capabilities [33][34] Question: Thoughts on tokenized assets and their impact on banking revenues - Management views tokenized assets as an opportunity rather than a threat, with ongoing projects aimed at developing programmable currency and enhancing customer value [39][40] Question: Distribution strategy and potential for more frequent buybacks - Management remains committed to distributing excess capital and will consider the form and timing of distributions at the end of the year, with no immediate plans for more frequent buybacks [42][44] Question: Trends in non-banking net interest income and other operating income - Non-banking net interest income is running about 10% ahead of last year, primarily driven by volume growth, while other operating income is expected to continue growing, albeit with some variability across divisions [62][66][68]