Lloyds Bank plc

2024 Q1 Interim Management Statement - Seite 2

The Group recognised remediation costs of £20 million in the first three months (three months ended 31 March 2023: £17 million), in relation to pre-existing programmes. There have been no further charges relating to the potential impact of the FCA review into historical motor finance commission arrangements, with the FCA having indicated it will update in September.

Impairment was a charge of £70 million (three months ended 31 March 2023: £246 million). This reflects a larger credit from improvements to the Group's economic outlook in the first quarter compared to the prior year. The decrease also includes a release in Commercial Banking from loss rates used in the model, while observing a low charge on new and existing Stage 3 clients. Asset quality remains strong with credit performance across portfolios stable in the quarter and remaining broadly at, or favourable to pre-pandemic experience.

The Group recognised a tax expense of £428 million in the period compared to £555 million in the first three months of 2023 driven by lower profit in the period.

FINANCIAL REVIEW (continued)

Balance sheet

Total assets were £632 million higher at £606,037 million at 31 March 2024 compared to £605,405 million at 31 December 2023. Cash and balances at central banks reduced by £4,883 million to £53,026 reflecting a change in the mix of liquidity holdings. Financial assets at amortised cost were £5,396 million higher at £493,467 million compared to £488,071 million at 31 December 2023 with reverse repurchase agreements £6,849 million higher, offset by a reduction in loans and advances to customers of £1,046 million to £432,078 million. The decrease in loans and advances to customers represented a £1.6 billion reduction in the UK mortgages portfolio following the expected refinancing of the higher maturities in the fourth quarter of 2023, as well as a £0.8 billion reduction in Small and Medium Business lending, including repayments of government-backed lending. This was partly offset by growth in UK Retail unsecured loans of £0.7 billion, due to organic balance growth and lower repayments following a securitisation in the fourth quarter of 2023, alongside growth in UK Motor Finance and credit cards.