Great Britain

Lloyds swings to profit as bad debts cut on UK economic recovery

Lloyds Banking Group has revealed it swung to a £3.9 billion half-year profit from losses a year ago as it cut bad debt provisions thanks to the UK’s economic recovery.

The bank’s figures showed a boost to its bottom line from a further £333 million fall in bad debt provisions over its second quarter.

A total release of £837 million of cash put aside for loans expected to turn sour in the pandemic saw it return to statutory profit for the first half of 2021, from losses of £602 million a year ago.

Alongside the results, Lloyds also unveiled a deal worth around £390 million to buy savings and pensions firm Embark.

The lending giant said the deal – its biggest since it returned to private ownership four years ago – will see it add about 410,000 customers and £5 billion of assets under administration.

Interim chief executive William Chalmers, who is leading the bank until new boss Charlie Nunn arrives next month, said: “During the first six months of 2021, the group has delivered a solid financial performance with continued business momentum, bolstered by an improved macroeconomic outlook for the UK.

“While we are seeing clear progress in the vaccine rollout and emergence from lockdown restrictions, the coronavirus pandemic continues to have a significant impact on the people, businesses and communities of the UK.”

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