Lloyds Banking Group has announced plans to cut 3,000 jobs and 200 branches despite reporting pre-tax profits had doubled.
Pre-tax profits at the bank were £2.5bn for the half year to 30 June, up from £1.2bn for the same period last year.
The results were helped by a reduction in the provision set aside to deal with payment protection insurance complaints, which fell to £469m from £1.8bn.
Underlying profit was £4.2bn, down 5 per cent.
Lloyds is one of the stocks that has been hardest hit by the decision to leave the EU because it is so heavily plugged into the UK economy. Laith KhalafThe cuts are part of what the bank has labelled its ‘simplification targets’.
It had already announced in 2014 it would be cutting 9,000 jobs and 200 branches.
Antonio Horta-Osorio, group chief executive of Lloyds, said following Britain’s decision to leave the European Union, a “deceleration of growth seems likely” in the UK.
The bank will pay an interim dividend of 0.85 pence per share, up 13 per cent.
Laith Khalaf, senior analyst at Hargreaves Lansdown, said: “Lloyds has set out its stall as a multi-channel bank, but the reality is that demand for banking services is moving online, and so banks must follow where there customers lead, and ultimately that doesn’t bode well for high street branches.
“Hence the closure of more high street branches and job losses is part and parcel of the technological revolution that is affecting many industries.
“Lloyds is one of the stocks that has been hardest hit by the decision to leave the EU because it is so heavily plugged into the UK economy, and the Brexit vote has raised a dust cloud of uncertainty around the future economic prospects for the country.
“Statutory profits have doubled in the last year, though that’s largely due to the receding shadow of PPI claims. However underlying profit, which gives a better view of the business going forward, was down slightly thanks to lower revenues and slightly higher loan impairment charges.”
laura.miller@ft.com
