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Lloyds Banking Group posts £3.25bn loss in H1

Lloyds Banking Group has reported a loss before tax of £3.25bn, or £0.34 loss per share, for the first half of 2011, compared to a profit before tax of £1.3bn, or £0.9 earnings per share for the same period in 2010.

On a statutory basis, loss before tax included a non-recurring provision for Payment Protection Insurance contact and redress costs of £3.20bn and a charge for integration costs of £642m (first half of 2010: £804m).

The higher international losses mainly reflected an increased impairment charge relating to the company’s Irish portfolio in the first half of 2011 compared to the same period in 2010, although this charge was a third lower than in the second half of 2010.

In the core business, profit before tax fell 28%, but excluding liability management and ECN effects the decline was 6%, principally as a result of a 5% fall in average interest-earning assets.

The bank recorded total income of almost £10.85bn net of insurance claims for the first half of 2011, compared to £12.48bn for the same period in 2010.

The group reported a combined businesses profit before tax of £1.10bn for the first half of 2011, with the core business delivering profit before tax of £2.66bn.

Lloyds Banking Group CEO Antonio Horta-Osorio said that the group delivered a resilient first half performance, despite the ongoing challenges of economic and regulatory uncertainty, and have made substantial progress in restructuring and de-risking the group.