Lloyds Banking Group (LLOY) — Company Research

Last Updated: 21 October 2026

Lloyds Banking Group plc is one of the UK's largest retail and commercial banking groups, operating through brands including Lloyds Bank and Bank of Scotland and, since October 2026, the combined Lloyds Auto motor brand. Unlike HSBC or Barclays it has almost no international business, so its earnings are a fairly direct read on UK mortgages, savings, interest rates and household credit. Since the last version of this report the group has posted a 23% rise in first-half statutory profit, launched a new "Accelerate 2030" strategy with higher return targets, completed a £1.75bn buyback and seen the motor finance redress litigation timetable pushed into 2027. Every figure below comes from the group's results announcements, RNS notifications and SEC filings. There are no analyst opinions, price targets or ratings anywhere in it.

Share prices, and figures worked out from them, are not shown for London-listed companies on ChartsView.

1. Company Snapshot

Field	Value
Ticker / exchange	LLOY.L — London Stock Exchange (NYSE ADS: LYG)
Sector	Banking — UK retail and commercial banking, insurance, pensions and investments
Revenue (FY2025)	£19,755m underlying net interest income plus other income; £18,301m underlying net income after operating lease depreciation; £19,422m statutory total income
Statutory profit before tax (FY2025)	£6,661m (FY2024: £5,971m)
Statutory profit after tax (FY2025)	£4,757m
Basic EPS (FY2025)	7.0p (FY2024: 6.3p)
Dividend per share (FY2025)	3.65p total ordinary dividend
H1 2026 statutory profit before tax	£4,293m, up 23%
Return on tangible equity (H1 2026)	17.1% (H1 2025: 14.1%)
CET1 capital ratio (30 June 2026)	13.6%; 13.1% pro forma for the new £1.0bn buyback
Total assets (30 June 2026)	£994.2bn
Employees	About 60,100 at 31 December 2025 (FY2025 Form 20-F); average of 64,038 during 2025
CEO / Leadership	Charlie Nunn, Group Chief Executive; William Chalmers, Chief Financial Officer; Sir Robin Budenberg, Chair
Headquarters	London, United Kingdom

2. The Bull and Bear Case

Bull Case

• Returns stepping up: H1 2026 return on tangible equity was 17.1% against 14.1% a year earlier, ahead of 2026 guidance of above 16%, with statutory profit after tax up 23% to £3,123m.
• Margin still widening: the banking net interest margin rose to 3.19% in H1 2026 from 3.04%, and reached 3.22% in Q2, lifting underlying net interest income 9% to £7,278m.
• Higher targets to 2030: the Accelerate 2030 plan targets RoTE above 18% in 2028 and around 20% in 2030, a cost:income ratio below 45% by 2030 and about £2bn of gross cost savings.
• Steady capital return: the interim dividend was raised 30% to 1.58p, the £1.75bn 2025 buyback completed on 25 September 2026 and a further £1.0bn programme is running to January 2027.

Bear Case

• Motor finance still unresolved: the group carries a £1,950m motor finance provision, and the Upper Tribunal will not hear the four challenges to the FCA's redress scheme until 16–26 February 2027, leaving final cost and timing open.
• A pure UK bet: almost all income comes from UK households and businesses, so a UK slowdown, falling house prices or higher unemployment would hit Lloyds more directly than its internationally diversified peers.
• Rate sensitivity: net interest income is about 69% of underlying income, so Bank of England cuts from the current 3.75% Bank Rate would pressure the margin.
• Senior insiders selling: the CFO sold 9.1m shares in August and the Chief Risk Officer 4.0m shares in September 2026, both discretionary disposals.

3. Revenue Segments

Lloyds reports four segments. The figures below are underlying net income for the six months to 30 June 2026, from the 2026 half-year results.

Segment	% of revenue	What it is
Retail (£5,710m)	58.6%	Mortgages, current accounts, savings, credit cards, unsecured loans and motor finance and leasing, now branded Lloyds Auto. H1 2026 underlying profit £2,256m.
Commercial Banking (£2,897m)	29.7%	Lending, transaction banking and markets for small businesses, mid-market and large corporates. H1 2026 underlying profit £1,425m.
Insurance, Pensions and Investments (£747m)	7.7%	Pensions, protection, general insurance and wealth management, including Lloyds Wealth (formerly Schroders Personal Wealth). H1 2026 underlying profit £245m.
Equity Investments and Central Items (£393m)	4.0%	Equity investments, the Lloyds Living rental homes business and central treasury items. H1 2026 underlying profit £289m.

Group H1 2026 underlying net income was £9,747m, up 9%. Compare UK bank names on the ChartsView Live Charts page.

4. Business Model and Moat

How it makes money. Lloyds is a lending and deposit franchise. In FY2025 underlying net interest income was £13,635m and underlying other income £6,120m, from which £1,454m of depreciation on its car and fleet leasing book is deducted to give underlying net income of £18,301m. The banking net interest margin was 3.06% for 2025 and 3.19% in H1 2026.

Unit economics. At 30 June 2026 customer deposits were £500.9bn against underlying loans and advances of £491.5bn, so the bank funds its lending almost entirely from deposits. Operating costs were flat at £4,876m in H1 2026, giving a cost:income ratio of 50.4%, and the asset quality ratio was 25 basis points.

The moat. Lloyds has one of the largest UK retail customer bases and current-account franchises, and customers rarely switch banks, which gives it cheap, sticky funding. Scale lets it spread technology and compliance costs across a very large customer base, and the integrated mortgage, insurance, pensions and car-finance offering keeps customers inside the group.

Capital return policy. The group targets capital generation of above 200 basis points in 2026 and pays down to a CET1 ratio of around 13.0%, returning surplus capital through a progressive ordinary dividend and buybacks.

5. Financial Health

Lloyds reports in pounds sterling. The revenue column is underlying net interest income plus underlying other income, before the deduction of operating lease depreciation, taken from the underlying income statement in each year's full-year results. Statutory total income and Lloyds' headline underlying net income are shown in the note below the table.

Fiscal Year	Revenue (£m)	YoY %	GAAP EPS	Adjusted EPS	Dividend/share	Long-term debt (YE)
FY2021	16,223	+6.1%	7.5p	7.5p†	2.00p	£71,552m
FY2022	17,838‡	+13.5%‡	4.9p	4.9p†	2.40p	£78,978m
FY2023	18,888	+5.9%	7.6p	7.6p†	2.76p	£80,857m
FY2024	18,442	−2.4%	6.3p	6.3p†	3.17p	£75,464m
FY2025	19,755	+7.1%	7.0p	7.0p†	3.65p	£82,514m

† Lloyds does not publish an adjusted earnings per share figure; statutory basic EPS is repeated so the table stays complete. ‡ FY2022 is restated for IFRS 17 (underlying net interest income £13,172m plus other income £4,666m); the FY2022 growth rate is on the original IFRS 4 basis (£18,421m against £16,223m), and FY2021 is on the IFRS 4 basis. FY2022 EPS is the restated figure. Statutory total income was £15,541m (FY2022 restated), £18,629m (FY2023), £18,003m (FY2024) and £19,422m (FY2025). Underlying net income after operating lease depreciation was £15,763m, £17,465m, £17,932m, £17,117m and £18,301m for FY2021–FY2025. Long-term debt is debt securities in issue at each year end from the group's SEC XBRL data (ifrs-full:DebtSecurities, Lloyds Banking Group plc, CIK 0001160106); the group also had subordinated liabilities of £9,894m at the end of FY2025 (FY2021: £13,108m).

Quarter / Half	Revenue (£m)	Adjusted EPS	GAAP EPS
Q2 2026	5,414	2.4p†	2.4p
Q1 2026	5,174	2.4p†	2.4p
Q4 2025	5,123	2.2p†	2.2p
Q3 2025	5,008	1.0p†	1.0p
Q2 2025	4,878	2.1p†	2.1p
FY2025 total	19,755	7.0p†	7.0p

Quarterly revenue is underlying net interest income plus underlying other income from the quarterly tables in the H1 2026 results and Q3 2025 interim management statement. Q3 2025 earnings were reduced by an £800m motor finance provision. At 30 June 2026 total equity was £47.2bn, risk-weighted assets £241.8bn and debt securities in issue at amortised cost £90.9bn.

6. Valuation Metrics

Share prices, and figures worked out from them, are not shown for London-listed companies on ChartsView.

Raw metrics, October 2026. Not opinions on whether the stock is cheap or expensive.

Metric	Value
Tangible net assets per share	57.0p at 30 June 2026 (unchanged since 31 December 2025)
Return on tangible equity	17.1% in H1 2026; 2026 guidance above 16%; target above 18% in 2028
CET1 capital ratio	13.6% at 30 June 2026 (13.1% pro forma); paying down to around 13.0%
Banking net interest margin	3.19% in H1 2026 (Q2 2026: 3.22%)
Cost:income ratio	50.4% in H1 2026; 2026 guidance below 50%
Asset quality ratio	25 basis points in H1 2026
Shares in issue	58,081m at 30 June 2026, excluding own shares, falling as bought-back shares are cancelled
Short interest (% of float)	— not published for this period. Since 13 July 2026 the Financial Conduct Authority publishes only anonymised aggregate net short positions under PS26/5; Lloyds did not appear in the FCA aggregate file dated 16–19 October 2026, which lists companies with notified positions at or above 0.2%. Verify at fca.org.uk.
Days to cover	n/a — not published for London-listed shares under the current FCA regime

7. What Are They Building

Accelerate 2030. Launched with the H1 2026 results on 30 July 2026, the new strategy succeeds the 2022–2026 plan and targets the UK's structural growth areas: housing, the digital economy, infrastructure and energy. It sets a mid-single-digit net income growth rate for 2027–2030, high-single-digit growth in other income, a cost:income ratio below 45% in 2030 and capital generation above 225 basis points in 2030.

An integrated transport business. On 16 October 2026 the group combined Black Horse motor finance, Lex Autolease and the Tusker salary-sacrifice fleet of more than 100,000 vehicles under one brand, Lloyds Auto, as part of a plan to build the UK's first integrated transport ecosystem.

Wealth and AI-led advice. Insurance, Pensions and Investments is targeting high-single-digit income growth, built around Lloyds Wealth and "Invest AI", an AI-enabled service intended to bring simple financial advice to all customers. The group is extending its next-generation retail core banking engine and scaling agentic AI, including the conversational "Explore Your Spending" tool and fraud response; on 19 October 2026 it held 15th place globally in the Evident AI Index, the highest of any UK bank.

New payments capability. The acquisition of digital wallet provider Curve completed in May 2026, and on 30 September 2026 the group completed a live pilot with Visa of stablecoin-based cross-border settlement. Lloyds Living aims to own more than 20,000 rental homes by 2030.

8. Competitive Landscape

Lloyds competes for UK mortgages, deposits and business lending with the other large UK banks and building societies.

Peer	Key metric (latest reported)
NatWest Group (NWG.L)	H1 2026 operating profit before tax £4,318m, up 20.4%, with RoTE of 19.7%; completed the £2.2bn Evelyn Partners acquisition on 30 Jun 2026 (H1 2026 results)
Barclays (BARC.L)	H1 2026 profit before tax £6,066m, up from £5,203m, with RoTE of 14.8% (H1 2026 results)
HSBC Holdings (HSBA.L)	H1 2026 profit before tax US$19.5bn, up from US$15.8bn, with annualised RoTE of 18.2% (interim results, 4 Aug 2026)
Santander UK	H1 2026 profit before tax £528m, down 31% from £764m, on motor finance provisions and restructuring (Q2 2026 quarterly management statement)
Nationwide Building Society	Year to 31 Mar 2026 underlying profit before tax £2,026m, up 9%; statutory £1,490m (2026 preliminary results)

Lloyds' H1 2026 RoTE of 17.1% sits between NatWest and Barclays. It is the most purely domestic of the listed UK majors, which makes it the most exposed to the UK economy and the motor finance outcome.

9. Leadership and Insider Activity

Charlie Nunn is Group Chief Executive (CEO), William Chalmers is Chief Financial Officer, and Sir Robin Budenberg was re-elected as Chair at the AGM on 14 May 2026 with about 99% of votes in favour. Kelly Bennett, formerly Chief Marketing Officer of Netflix, joined the board as an independent non-executive director on 1 September 2026. No dealings by Charlie Nunn were found in the August–October 2026 notifications reviewed.

The following director and PDMR dealings were disclosed through RNS notifications between August and October 2026. A PDMR is a person discharging managerial responsibilities.

Name	Date	Type	Shares	Plan Type
William Chalmers (CFO)	27 Aug 2026	Sale	9,100,000	Discretionary sale; still above shareholding requirement
Stephen Shelley (Chief Risk Officer)	09 Sep 2026	Sale	4,000,000	Discretionary sale
Jasjyot Singh (CEO, Consumer)	16 Sep 2026	Purchase	25,481	Dividend reinvestment
William Chalmers (CFO)	21 Sep 2026	Option grant	7,813	Sharesave
Chirantan Barua (CEO, Wealth and Insurance)	21 Sep 2026	Sale	80,810	Discretionary sale
Catherine Woods (Non-executive director)	23 Sep 2026	Purchase	1,810	Dividend reinvestment
Seven PDMRs incl. Amanda Murphy and Stephen Shelley	09 Oct 2026	Purchase	74 to 194 each, plus 44 matching shares	Share Incentive Plan

10. Key Risks

• Motor finance redress (Conduct / litigation): the £1,950m provision includes £800m added in Q3 2025. The FCA's final scheme estimates industry redress of £7.5bn, parts of it have been suspended since 2 July 2026, and the Upper Tribunal hearing on four challenges is set for 16–26 February 2027.
• UK economic concentration (Macro): with almost no overseas business, a UK recession, rising unemployment or a fall in house prices would feed straight into impairments and loan growth; management cites macroeconomic and geopolitical uncertainty as a principal risk.
• Interest rates and margin (Interest rate): net interest income is the dominant source of income, so the path of Bank Rate, held at 3.75% on 17 September 2026, and mortgage pricing competition drive earnings.
• Credit quality (Credit): the asset quality ratio is 25 basis points and guidance for 2027–2030 is 25–30bps; the H1 2026 charge included £80m for a weaker economic outlook tied to the Middle East conflict.
• Operational resilience and AI (Operational): cybersecurity, IT stability, supplier risk and the safe use of models and AI are named principal risks as the group modernises its core systems.
• Capital and distributions (Capital): CET1 is being run down towards around 13.0%, so higher risk-weighted assets, regulatory change or a larger motor finance bill would compete directly with buybacks.
• Acquisition integration (Strategic): the group lists capturing value from acquisitions as a risk factor while integrating Curve and Lloyds Wealth and combining its motor businesses into Lloyds Auto.

11. Recent Developments

• 30 Jul 2026 — H1 2026 results and Accelerate 2030. Statutory profit before tax £4,293m, up 23%; RoTE 17.1%; interim dividend raised 30% to 1.58p and a new buyback of up to £1.0bn announced. 2026 guidance was reiterated and new 2028 and 2030 targets set.
• 27 Aug 2026 — Board appointment. Kelly Bennett appointed an independent non-executive director from 1 September 2026.
• 28 Aug 2026 — CFO share sale disclosed. William Chalmers reported the sale of 9,100,000 shares on 27 August 2026.
• 25 Sep 2026 — £1.75bn buyback completed. The group completed its 2025 buyback, having bought 1,712,662,647 shares between 30 January and 24 September 2026.
• 30 Sep 2026 — Stablecoin pilot with Visa. Lloyds completed a live pilot of stablecoin-based cross-border settlement with Visa.
• 13 Oct 2026 — Motor finance hearing dated. The Upper Tribunal set 16–26 February 2027 to hear challenges to the FCA redress scheme from three lenders and one consumer group; Lloyds is not among the challengers.
• 16 Oct 2026 — Lloyds Auto launched. Black Horse, Lex Autolease and Tusker were brought together under a single brand.
• 19 Oct 2026 — AI ranking. Lloyds held 15th place globally in the Evident AI Index, the highest-ranked UK bank, and launched an "Investing in Britain Hub".

12. Key Dates to Watch

• 29 Oct 2026 — Q3 2026 interim management statement, 7am (group financial calendar)
• 05 Nov 2026 — Bank of England Monetary Policy Committee decision; Bank Rate currently 3.75%
• 27 Jan 2027 — expected completion date for the £1.0bn H2 2026 buyback
• 28 Jan 2027 — FY2026 preliminary results, likely to include the final dividend and next buyback
• 04 Feb 2027 — 2026 Annual Report published
• 16 Feb 2027 — Upper Tribunal hearing on the motor finance redress scheme begins, scheduled to run to 26 February 2027
• 29 Apr 2027 — Q1 2027 interim management statement
• TBC — 2027 AGM and FY2026 final dividend dates, not yet published

Bank of England decisions, UK inflation and labour market releases are on the ChartsView Economic Calendar. Discuss UK bank results with other investors in the ChartsView Forum.

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