Lloyds Q1 profit beats estimates as UK lender reiterates guidance for 2026

[LONDON] Lloyds Banking Group, Britain’s biggest mortgage lender, reported a 33 per cent increase in quarterly earnings that beat analyst estimates.

The London-headquartered bank said pretax profit rose to £2.03 billion (S$3.5 billion) for the three months ended March, exceeding the £1.78 billion consensus estimate compiled by Bloomberg.

Net interest income rose to £3.57 billion from £3.29 billion in the year-ago period, while operating costs declined 3 per cent.

It set aside £295 million for loan-loss provisions. It did not change a previously announced almost £2 billion charge tied to bad car loans.

The lender also reiterated its earlier guidance for 2026.

CEO Charlie Nunn on Wednesday (Apr 29) said: “Our differentiated business model remains resilient in the context of the current economic uncertainties.”

Lloyds is the second major UK bank to report earnings this week, following Barclays.

Much of Wall Street rode the market volatility sparked by the US-Iran war to make windfalls last quarter, trading in stocks, bonds, commodities and currencies.

However, Lloyds’ fortunes are more tied to British consumer health because of its domestic retail focus.

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Oil prices climbed above US$112 a barrel on Tuesday and traded near a four-year high, as the fallout of the Gulf conflict elevated inflation concerns and dashed prewar expectations of interest-rate cuts by the Bank of England.

The monetary authority on Thursday is expected to lower its growth outlook for 2026 and the year after.

Lloyds is often seen as a bellwether for the UK economy.

“Increases in energy prices lead to the re-emergence of inflationary pressures, with reductions in the UK bank rate expected to be delayed until 2027,” it said.

The bank is transforming its use of technology, including adding artificial intelligence to a wide range of tasks, to give customers better information, prevent fraud and improve operations.

The company has described itself as “the UK’s largest fintech”. BLOOMBERG