From Morningstar: 2025-05-05 15:32:00

Lloyds reported underlying profits of GBP 1.53 billion for Q1 2025, down 13% from last year due to higher loan losses, including a GBP 100 million charge for potential tariff-induced risks. Net interest income grew by 3% to GBP 3.29 billion, supported by a structural hedge. Mortgage and deposit growth were positive.

Operating costs increased by 6% to GBP 2.55 billion, half of which was due to severance pay and strategic costs. Lloyds continues to guide for a 25-basis-point loan loss ratio for the year. The bank is facing scrutiny over its ability to diversify income streams away from interest-rate-dependent mortgage lending.

Morningstar maintains a fair value estimate and narrow moat rating for Lloyds. The bank’s operating performance was decent, with other income growing by 8% to GBP 1.45 billion. Progress in increasing non-interest-rate-related income share has seen a step change in performance but has slowed since. Operating cost guidance for the full year remains at GBP 9.7 billion.



Read more at Morningstar: Lloyds Earnings: Decent Quarter as Firm Sets Aside…