Lloyds TSB profits rise despite consumer debts

09-08-2006

High street bank Lloyds TSB's pre-tax profits rose by four per cent during the last six months, despite a rising number of bankruptcies among its customers, the firm has announced.

Pre-tax profits for the six months to June stood at £1.78 billion, compared to £1.71 billion at the corresponding period last year.

However, its overall financial picture was hit by increasing levels of consumer debt, which manifested itself in a soaring number of insolvencies.

The bank's debts rose to £800 million, £632 million of which came from its retail banking divisions.

But Eric Daniels, Lloyds TSB chief executive, said the last six months had been "pleasing" for the bank, explaining that the losses in its unsecured loans group were "anticipated".

"We have continued to show tangible progress against the second phase of our strategy, which focuses on building customer franchises for sustained growth. We have seen strong growth in sales, improved levels of customer acquisition and success in deepening relationships," he said.

Even taking into account the rising instances of enforced bankruptcies, products sales in Lloyds TSB's retail banking divisions rose 17 per cent, while its Scottish Widows group enjoyed a 35 per cent increase in new business sales.

Lloyds TSB's overall earnings per share rose by two per cent, with wholesale and international banking growth now standing at six per cent.


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