British bank Lloyds rebounds into quarterly profits
Britain's state-rescued Lloyds bank said Tuesday that it rebounded into first-quarter net profits on the back of rising income, deep cost-cutting and falling impairment charges.
Earnings after taxation hit £1.53 billion ($2.37 billion, 1.81 billion euros) in the three months to the end of March, Lloyds said in a results statement. That contrasted with a slender net loss of £5.0 million in the same part of 2012.
Lloyds was boosted by a one-off gain of £394 million from the sale of shares in investment manager St James's Place.
Costs fell six percent to £2.408 billion and impairment charges were slashed 40 percent to £1.002 billion.
The bank was also lifted because it did not face further provisions to cover product mis-selling in the quarter.
"We made substantial progress again in the first quarter," said chief executive Antonio Horta-Osorio.
"Underlying and statutory profits improved significantly, and our core loan book returned to growth earlier than expected.
"Margin increased, and costs and impairments continued to fall rapidly, with this progress underpinned by a further strengthening of our balance sheet."
The results were published almost one week after Lloyds announced that a deal to sell 632 branches at a loss to The Co-operative Group had collapsed.
The branches will now be floated on the London stock market under the bank's TSB name.
The re-branded TSB stores will appear on the British high street in the summer.
Lloyds added on Tuesday that the bill for offloading the branches was likely to reach £1.3 billion.
LBG was created by a merger of Lloyds TSB and rival British lender HBOS in the wake of the 2008 financial crisis.
However, HBOS was saddled with high-risk property investments. LBG subsequently received a massive bailout and remains 39-percent government-owned.
In a bid to turn around its fortunes, LBG had last July agreed to sell the 632 branches to The Co-op after an EU competition ruling.
Earlier this month, British lawmakers recommended that the former bosses of failed bank HBOS should be banned by regulators from working in the financial sector ever again.
The influential Parliamentary Commission on Banking Standards attacked the group's ex-chairman Lord Dennis Stevenson and previous chief executives Sir James Crosby and Andy Hornby in a key review.
In the report -- called 'An Accident Waiting to Happen' -- the Commission slammed the trio for a "toxic misjudgements" and a "colossal failure" of management in pursuing a high-risk strategy that caused its downfall in 2008.
© 2013 AFP