Lloyds posts jump in H1 profits, lifts dividend

(Sharecast News) - Lloyds Banking Group backed its full-year outlook on Thursday and lifted its dividend as it reported a jump in first-half profits. In the six months to 30 June, pre-tax profit rose 5% on the same period a year earlier to £3.5bn. Underlying profit ticked up 2% to just under £3.6bn, driven by 6% growth in net income, partially offset by slightly higher operating costs and impairments.

Lloyds hailed strong growth in lending and deposits. Underlying loans and advances to customers rose by £11.9bn, or 3% to £471bn, with growth of £10.1bn across retail, led by mortgages, alongside an increase pf £1.2bn in commercial banking.

Meanwhile, customer deposits were £11.2bn or 2% higher at £493.9bn, with £3.7bn growth in retail - driven by savings - and £7.6bn in commercial banking.

Lloyds declared an interim ordinary dividend of 1.22p per share, up 15% on the previous year.

Chief executive Charlie Nunn said: "We have shown sustained strength in our financial performance in the first half of 2025, with income growth, cost discipline and robust asset quality, driving strong capital generation and increased shareholder distributions, with a 15% increase in the interim ordinary dividend.

"We continue to make great progress in our purpose-driven strategy, building differentiated customer outcomes and delivering growth across our business as we build towards our ambitious targets for 2026.

"Our strategic progress and sustained strength in our financial performance allows us to re-affirm our 2025 guidance and gives us confidence in our 2026 commitments. It also underpins our delivery of higher, more sustainable returns for our shareholders."

At 1500 BST, the shares were up 1.3% at 78.67p.

Russ Mould, investment director at AJ Bell, said: "Tellingly, despite the better-than-anticipated profit, the company has left full-year guidance unchanged. On an underlying basis this was a 'steady as she goes' announcement not a 'shoot the lights out' one.

"While there were no further provisions relating to motor finance mis-selling, a Supreme Court ruling, expected in the next few weeks, continues to loom large for the company. Lloyds needs a favourable outcome to stand a chance of achieving its returns target.

"Costs were higher, despite ongoing efforts to increase efficiency through digitisation, although this partly reflected the impact of redundancy costs as the bank reduced its workforce."