PPI Charges Disappoint But Lloyds' Performance Improves

Lloyds posted underlying profit of £4.5 billion during first-half of 2017, a 8% year-on-year increase

Derya Guzel 27 July, 2017 | 1:09PM
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Lloyds (LLOY), which has returned to full private ownership following the sale of the U.K. government's stake in May 2017, posted underlying profit of £4.5 billion during first-half 2017, indicating an 8% year-over-year increase.

PPI remains a downside risk to Lloyds' profit generation

Following what we view as operationally intact results, we maintain our fair value estimate of 84p per share and our net income estimate of £4 billion for 2017. We also retain our narrow moat rating for Lloyds, which remains our preferred name within the U.K. banking space.
However, the bank's reported profit was affected by further PPI and conduct charges put aside during the second quarter.

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Securities Mentioned in Article

Security NamePriceChange (%)Morningstar
Rating
Lloyds Banking Group PLC45.89 GBX1.45Rating

About Author

Derya Guzel  is an Equity Analyst for Morningstar

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