TIDMLLOY
RNS Number : 6547N
Lloyds Banking Group PLC
21 May 2020
21 May 2020
Lloyds Banking Group plc ("the Company")
Virtual Shareholder Event Statements
Following the Annual General Meeting of Lloyds Banking Group
plc, held at The Mound, Edinburgh, EH1 1YZ today, the following
statements were made at a virtual shareholder event by the
Chairman, Lord Blackwell and Group Chief Executive Officer, António
Horta-Osório.
Chairman's speech
Welcome to the Lloyds Banking Group virtual shareholder event.
It's highly unusual to be addressing you from my home, instead of
from our usual venue in Edinburgh, I hope for those of you
watching, your families and loved ones are staying safe and
well.
Our Annual General Meeting is an important event for the Group,
allowing us to engage directly with you, our shareholders as well
as for you to vote on our resolutions. But, with the current
restrictions on people's movement and ability to gather, like many
other companies, we have been forced to hold a virtual shareholder
event rather than our usual AGM. The results of the votes on the
resolutions proposed at this morning's AGM will be announced on our
website in the usual way shortly.
However, we hope that this virtual meeting will help maintain
our commitment to engaging with you as shareholders. We know how
important it is to address your questions, and we value the
opportunity to update you on the development of the Group,
particularly given the extraordinary times in which we find
ourselves.
I am pleased that later on in this presentation, after you have
heard from Antonio and myself, we will be joined by Sara Weller,
our Chair of the Board's Responsible Business Committee to spend
some time addressing many of the questions you have submitted. And,
while we may not have time to address them all in this broadcast,
we will ensure every question gets an individual reply.
But let me start with Covid-19, which has changed and disrupted
life for everyone in this country. Lloyds Banking Group's core
purpose is to Help Britain Prosper, and this commitment is now more
important than ever. While the outlook is challenging and
uncertain, we are determined to play our part in helping Britain
recover from this crisis, and you'll hear more from Antonio on this
later.
In our 250 years of serving the British economy we have
experienced many downturns and several crises and on each occasion
we have worked hard to contribute to the recovery of the economy
and be there, by our customers' side. We expect to do exactly the
same this time.
At this stage we can't be sure how the situation will evolve.
But we do know that the impact of Covid-19 on our society, our
economy and the way we go about our lives will be long lasting and
profound. We recognise that our success is inextricably linked to
the success and health of the UK economy. The funding support that
we are providing to companies, supports businesses that employ
millions of people, who in turn are repaying mortgages, loans and
credit cards. Similarly the direct relief we are providing to
households is crucial to help them cope with the pressure on their
finances. In addition, our charitable Foundations are continuing to
play a vital role supporting the communities in which we operate,
as are our many volunteers.
As a Group at the heart of the UK economy, we have a
responsibility to take action. And it's in our interests to play
our role in helping to get the country through the current crisis
and return to prosperity.
This support will of course have a cost, but we see this social
contribution as a type of social dividend - recognising both our
obligations as a responsible business and the benefit we gain from
operating in communities that we can help return to prosperity.
It's the right thing to do and deployed at a time when our
customers and communities most need it.
And, of course, this support for our customers and communities
is only possible because of our people. Antonio will add his
observations later about the remarkable work of so many of our
employees. But let me say how deeply proud I am of how they have
responded to this crisis. Many are going to exceptional lengths
every day to serve our customers and their communities. Thank you
to all of them.
Let me now turn to the more usual business of the meeting,
starting with the Board.
Since our 2019 AGM we have appointed Sarah Legg and Catherine
Woods as Non-Executive Directors. Sarah who joined the Board on the
1st December 2019, was previously Group Financial Controller of
HSBC. Catherine joined the Board on the 1st March 2020 after
retiring as Deputy Chairman and Senior Independent Director of
Allied Irish Bank last October. Both, I believe, are excellent
appointments with strong relevant experience in the financial
sector and bring different perspective and insight as well as
supporting the Board's commitment to diversity.
I'd also like to take this opportunity to thank Anita Frew who
stepped down as Senior Independent Director in December and is
retiring as Deputy Chairman and Non-Executive Director at this AGM.
Anita joined the Board in 2010 and her support and insight have
been invaluable to me personally and to all the Board.
Alan Dickinson succeeded Anita as Senior Independent Director
and he will also now take on the role of Deputy Chairman. As part
of this, Alan is stepping down as Chair of the Board Risk Committee
and passing that role to Nick Prettejohn.
I would also like to thank our Chief Operating Officer and
Director, Juan Colombás, who had planned to retire in July for
agreeing to remain in post and on the Board until September. Juan
is playing a key role in the Group's response to the Covid-19
crisis and his delayed departure will enable us to draw on his deep
understanding of the business for a little while longer.
Finally, on Board matters, since I am now moving to my 9th year
on the Group Board, I previously announced that I plan to retire as
Group Chairman no later than the next AGM. A search process was
started at the beginning of the year to enable an orderly handover
once my successor is identified.
I'd like to thank all our Board Members for their contribution
and commitment over the past year.
Let me now turn to business performance and strategy. The Group
delivered a resilient performance in 2019, maintaining our
underlying profit with continued focus on our leading cost
efficiency while increasing our strategic investment and
strengthening our position as the UK's largest digital bank. During
2019 we also continued to deliver on our purpose to Help Britain
Prosper, including lending to around 1 in 4 first-time buyers;
lending some GBP18bn to businesses across the UK; and supporting
renewable energy projects which will power 5 million homes by
2020.
However we were of course disappointed that our statutory
performance was impacted by additional PPI charges in the year,
reflecting the increased volume of claims in the run up to the
deadline last August.
Although the world has changed significantly since the year end,
Antonio will highlight the key points from our 2019 performance in
a moment. However I would like to say a few words about our
long-term strategic aims and progress.
Following the Group's return to profitability after the last
financial crisis, our strategic aim has been to transform the
business to succeed in the rapidly changing consumer, technology
and competitive environment. This means not only ensuring we have
leading digital channels that allow customers to interface quickly
and easily with our services on their phones and tablets, but also
reengineering our internal processes and technology platforms to
provide the speed and reliability that customers increasingly
expect. That in turn means significant new demands on the skills
and working patterns of our dedicated staff. It is a massive but
essential programme of change to ensure we have a business that can
sustain its service to customers and returns to shareholders in the
years to come.
Given the growth of new competition, both large and small, our
strategy has also been to recognise and build on the Group's areas
of distinctive strength. One of those is the unique position we
have to serve customers savings and retirement needs by linking the
strength of our Scottish Widows business to our wider bank
franchise. Our unique Single Customer View, where customers can see
details of their pension and insurance products alongside their
bank accounts online, is now available to over 5 million banking
and insurance customers. We expect this to rise to around 9 million
by the end of 2020.
During 2019 we took significant steps to add to our offering
through strategic partnerships and acquisitions. We launched
Schroders Personal Wealth to customers in September and we are now
making good progress towards our ambition of becoming a top three
financial planning business by the end of 2023.
In other areas, we completed the integration of MBNA and
announced the acquisition of Tesco Bank's GBP3.7 billion prime
residential mortgage portfolio, demonstrating our ability to grow
in target areas where we see value for shareholders.
And in line with our overall strategic transformation, we
continued to respond to our customers' changing needs through our
multi-channel and multi-brand strategy. Alongside our commitment to
maintain the UK's largest branch network, we have invested in
innovative new branch formats and also strengthened our position as
the UK's largest digital bank. This continues to grow and we now
have over 16.9 million digital users.
For our commercial clients, we launched self-serve business
banking loans and rolled out a new digitised small business lending
tool. We were the first UK financial services provider to offer
access to a digital app to allow commercial clients to identify and
make energy-efficient investments in their buildings.
So I am pleased we continued to make strong strategic progress
in 2019, and are well placed with a strong balance sheet to
continue to support the UK through Covid-19 while maintaining our
vital strategic development.
Which brings me to the dividend. These extraordinary times lead
to difficult decisions. Following a request from the Prudential
Regulation Authority the Board of Lloyds, alongside all other major
UK banks, agreed to cancel the final dividend for 2019 in order to
provide assurance that the banking industry had the capital it
needed to support businesses and households through the current
crisis. We also made a commitment that we would declare no ordinary
dividends or share buybacks until the end of 2020. These were
decisions we did not take lightly. The Board fully understands the
decision on the dividend will be disappointing to you, our
shareholders, but we believe it was appropriate to agree to this in
the current exceptional circumstances.
However, while we have held back on the payment of dividends, I
am well aware that any surplus capital in the business still
belongs to you as shareholders. I would like to reassure
shareholders that the Board remains committed to returning surplus
capital to shareholders in due course both through future dividends
and potential share buy backs as appropriate and we will continue
to keep this under review.
Now let me turn to executive remuneration, and before I talk
about the changes we are proposing to our Remuneration Policy, I
would like to briefly mention a decision that has been taken in the
context of Covid-19.
I can confirm that in response to the current situation, our
Group Executive Committee have asked that they do not receive an
annual bonus under the 2020 Group Performance Share Award. This
decision was made in solidarity with the communities in which we
operate and in recognition of the priorities of our stakeholders -
and I believe it was the right thing for them to do.
In setting our general remuneration principles the Group
believes in pay for performance, ensuring our approach to
remuneration is aligned to the interests of our shareholders.
Variable remuneration is heavily weighted towards long-term
performance, with the majority being share-based. Awards are also
subject to deferral and holding periods.
For 2019, the reduction in statutory profit meant that the Group
Performance Share pool was reduced 33 per cent compared to 2018,
reflecting the impact of PPI and other conduct-related costs. The
Group Chief Executive and Chief Operating Officer also
independently requested not to receive Group Performance Share
awards for 2019.
As you will be aware, we proposed a new Directors' Remuneration
Policy for approval at today's AGM, following extensive
consultation with shareholders. You can read the detail of this
plan in the Annual Report, but I would like to draw your attention
to some of the highlights.
In November 2019, we announced that we would be reducing pension
allowances for Executive Directors to 15 per cent of salary,
subject to shareholder approval of the new Remuneration policy at
today's AGM. At the same time, we are making improvements to
pensions for all other 50,000 colleagues who participate in Defined
Contribution schemes to make them eligible for a maximum employer
contribution of 15 per cent as well.
We are also introducing a new long-term variable reward, known
as the Long Term Share Plan, to replace the current Group Ownership
scheme. We believe this plan is more closely aligned to creating
shareholder value over the longer term. We have aimed to reduce
complexity in our reward structure, but awards will be subject to a
pre-grant test as well as performance underpins to ensure they
don't reward failure - and the maximum opportunities in the plan
have also been significantly reduced. As a result of all these
changes, the maximum total compensation for the Group Chief
Executive is reducing by almost 30 per cent.
While we have had broad support for the new policy in our
consultation with shareholders, I'm aware that a number have
expressed continuing reservations about different aspects of the
plan, and in the light of today's votes we will continue to engage
with them, to discuss their concerns.
There, of course, has been a great deal of public interest in
matters of executive pay and fairness, and rightly so. We remain
very focused on addressing the pay gap in our organisation from the
bottom up, and not just from the top down. We hope you'll agree
that we have made significant progress in this respect over the
past year.
Finally, I would now like to provide a brief update in relation
to the historic HBOS Reading fraud and the progress made since last
year's AGM. As outlined last year, we have been providing
shareholders with a rolling update on the status of these matters
on our website.
As I have said before, the Group has deeply apologised to those
customers affected by these crimes and, following the conclusion of
the trial, sought to provide them with compensation for their
distress and losses. As detailed in our latest update, in December
we published the independent report by Sir Ross Cranston on our
compensation review which contained a number of recommendations,
and Antonio will update you further on this shortly.
We also continue to cooperate fully with the ongoing Dame Linda
Dobbs enquiry which the Board set up to look at the handling of the
investigations following the HBOS acquisition, and we are committed
to providing her with all the resource she needs to conclude her
review as rapidly as possible. Meanwhile, however, the Group
continues to develop our own learnings based on the insights from
customers and stakeholders, and we summarised some of those in our
shareholder update earlier this year.
As set out in that note, one clear conclusion we have recognised
is that the culture of the Group has at times been too defensive,
too bureaucratic and legalistic, failing to fully understand the
concerns raised by customers and communicate sympathetically. That
is something which, in recent years, we have been working hard to
address.
I am very conscious that the criminal activities that took place
over a decade ago in this HBOS operation have cast a long shadow
over the victims of the fraud as well as the reputation of our
bank, but I can assure you that we will continue our efforts to do
the right thing for all those whom it has impacted. And I am proud
of what I see now in the commitment of the many people who work for
Lloyds, who work every day to serve our customers to the best of
their ability and to earn their trust and loyalty.
So to conclude, the longer-term impact of coronavirus remains
unclear but the Group will maintain its focus on supporting
customers and the UK economy through the crisis while continuing to
transform the business for future success. I am confident in our
ability to do this and want to again express my gratitude to our
colleagues and customers at this difficult time.
I would like to thank all our shareholders for their continued
support and hope that this time next year we will be able to gather
for our AGM in the usual way. Meanwhile I hope all of you, and your
families, stay well and safe. Now let me hand over to António.
Chief Executive's speech
Thank you Chairman. On behalf of the Board and the Group
Executive Committee, thank you for your continued support and the
leadership and guidance you provide to the Group.
I would like to echo your acknowledgement of the extraordinary
times we are living in and take this opportunity to wish everyone
watching, and their families, well and hope that they stay safe and
healthy.
Despite the unusual circumstances, I am pleased that we still
have this opportunity to speak to you, our shareholders, and look
forward to answering the questions you have submitted. Before I
talk about our recent financial performance and progress in terms
of Responsible Business and the environment, I'd like to spend some
time on our response to the COVID-19 crisis and the incredible work
of our colleagues who continue to go above and beyond, in very
unusual and challenging circumstances to support our customers.
Covid-19 will have a deep and lasting impact on all of us. We
are totally committed to helping households and businesses, in turn
supporting the UK economy to weather the impact of Covid-19. This
has meant responding rapidly and at scale to lend to those who need
it while offering support to those who are struggling. As the
Chairman has said, this of course has come at a cost and we will
clearly see a financial impact from the steps we have taken to
support customers in our future results. However, we believe it is
the right thing to do. For Lloyds Banking Group, our customers and
the UK.
For our personal customers we have offered a range of practical
measures to help take the pressure off their finances in these
difficult times. This has included agreeing almost one million
repayment holidays for customers with mortgages, loans, motor
finance and credit cards. In addition, we are offering interest and
fee-free overdrafts up to GBP500.
And for our most vulnerable customers we have introduced a new
dedicated line for customers aged over 70. In addition, we have put
in place measures to give priority to customers who need extra
support, such as NHS workers.
I am also pleased to say that our operations have shown
resilience and we have adapted swiftly to the challenges we face.
Over 95 per cent of our branch network remains open and our call
centres are well-staffed to handle the significant increase in
volume being seen from customers. Importantly, our digital banking
apps have remained fully operational throughout the lockdown,
despite the significantly increased demands from existing and new
customers through new registrations and daily logins.
For the business community we have fully embraced the decisive
action of the Government to set up a number of emergency lending
schemes, as well as adopting our own measures to address companies'
cash flow pressures. Our commercial businesses have supported
clients by agreeing over 45,000 fee free overdrafts, capital
repayment holidays and deferred payments. This is all backed by our
GBP2 billion Covid-19 fund for SMEs and Mid Corporates.
As I look at the challenges we have faced and the way we have
had to rapidly adapt, I have been deeply impressed by the
commitment of our relationship managers who have been working
tirelessly, talking to tens of thousands of business customers to
understand how the coronavirus crisis is impacting them and to
provide support wherever they can.
For smaller businesses, which are the lifeblood of the British
economy, we have moved quickly. We are proud to be playing our part
by delivering the Government's flagship Bounce Back Loan scheme
approving loans totalling over GBP3.6bn and over 115,000
applications, which supports our business customers needing to
borrow less than GBP50,000. Our teams worked through many nights to
be successfully up and running on day one, with over GBP1bn of
loans paid within 24 hours to business customers who applied on the
first day.
The Coronavirus Business Interruption Loan Scheme - or CBILS -
is also a key part of our nation's response offering larger loans
to SMEs and we are approving the vast majority of eligible CBILS
applications that we assess. We have adapted our product range,
rapidly put in place new systems and significantly increased our
resources to speed up loan requests and approvals. This means we
have now been able to approve more than 6,700 CBILS loans to a
value of GBP1.1bn.
Finally, we have also enhanced our financial support for our
charitable partners and the Group's independent charitable
Foundations. In recent weeks we have launched a partnership with We
Are Digital which has seen tablet devices delivered free of charge
to over-70s isolated by Covid-19, to help keep them connected, as
well as providing a specialist phone line to help up to 20,000
customers access the internet.
We have also supported The Silver Line, a partner to Age UK, to
enable it to continue to offer a 24/7 helpline and friendship
services to those aged 55 and over who may be feeling lonely or
isolated. More broadly, we are continuing to support our charitable
Foundations as they help tackle social issues in communities, from
mental health to domestic abuse, homelessness and disability.
Secondly, our people have been - and will continue to be -
absolutely central to how we respond to the challenges of Covid-19.
Our colleagues have adapted swiftly to ensure the resilience of our
operations. I want to express my gratitude to all my colleagues
across the Group. They have shown exemplary dedication and
professionalism. I know that many of them remain anxious about the
health of loved ones and the impact of coronavirus on their
communities, but they have continued to be focused on serving our
customers every day.
I am proud to say that our colleagues support for customers has
been flexible and sensitive, while operationally we have shown
resilience, strength and the ability to adapt and innovate at pace.
In the first few weeks of the crisis we rolled out the technology
and training to allow around 45,000 of our colleagues to work from
home, up from the previous level of around 15,000. Where working
from home is not possible, and our colleagues are providing a
critical service, such as in our branch network, we have
consistently and closely followed government guidance around social
distancing and we have regularly updated and supported colleagues
on the precautions they should take. I want to commend the
collaborative role our unions, Unite and Accord have been playing
in helping us address staff concerns.
We have suspended all role reduction plans while committing to
pay all of our staff, in full, whatever their circumstances. This
is important as it removes uncertainty for our colleagues, and
allows them to focus on supporting our customers and serving their
communities.
I am proud of the way Lloyds Banking Group is responding,
collectively and individually. On behalf of the Board and Executive
Committee, thank you to all of our colleagues for the remarkable
contributions they are making at work, at home and in their
communities at this time.
I would now like to spend a bit of time talking about:
-- Our recent financial performance, the impact of Covid-19, and
how our financial strength is critical to our response and support
for customers;
-- Sir Ross Cranston's independent assessment of the Customer
Review implemented to compensate victims of the HBOS Reading fraud,
and
-- Our approach to responsible business and the environment.
Let me start with our recent financial performance and the
financial strength of the Group, which is fundamental in our
ability to support our customers through Covid-19.
Following a solid start to 2020, we are now seeing the emerging
economic impact of the coronavirus crisis and this will of course
be reflected in our performance going forward.
At our recent first quarter results we announced statutory
profit before tax of GBP74 million. This was heavily impacted by
the impairment charge of GBP1.4 billon in the quarter, primarily
due to forward looking charges relating to the projected economic
impact of the COVID-19 crisis. Our revenues were down 11 per cent
year on year, impacted by the rate environment and a slowdown
across all of our key markets, both of which we expect to continue
into Q2.
Importantly, the Group is in a strong financial position and our
balance sheet remains well positioned for the current environment
given our prudent approach to lending and low risk UK focused
strategy.
Secured lending makes-up over 80 per cent of our balance sheet,
including GBP310 billion in Retail and GBP30 billion in SME and Mid
Corporate assets. The rest of our loan book comprises our prime UK
consumer portfolio and our prudent exposure to UK Large Corporates.
We have no net wholesale debt and meanwhile our capital ratio of
14.2 per cent is significantly above our requirements. This gives
us substantial capacity to absorb risks while continuing to play
our part through lending and repayment holidays and other financial
measures to overall support households and businesses and
ultimately the UK economy.
Although the UK faces an uncertain outlook, our financial
strength will enable us to remain absolutely focussed on supporting
our customers and continuing to support all of the Government's
schemes.
As the Chairman mentioned earlier, I would now like to update
you on the steps we have taken following publication of Sir Ross
Cranston's independent report to assess the Customer Review, put in
place to compensate victims of the HBOS Reading fraud.
Sir Ross Cranston's review concluded that while compensation for
distress and inconvenience was generally "beyond what a customer
could hope to have been awarded under that head of loss by a
court", the way the Review operated did not achieve its objective
of giving all customers the confidence that they had received fair
and reasonable outcomes in respect of the assessment of direct and
consequential losses. The Group deeply regrets that these customer
concerns were not adequately addressed by the operation of the
Customer Review, despite our best intentions. We have fully
accepted Sir Ross's recommendations and are committed to
implementing them in full in order to put this right for
customers.
I am personally overseeing this, working with victims and other
stakeholders to ensure those customers affected by the HBOS Reading
fraud can now be confident their claims have been properly
addressed in an open and transparent manner.
The distress caused to those affected by the criminal misconduct
at HBOS Reading over a decade ago remains a matter of deep regret
to me and my colleagues. We are determined to rebuild trust by
implementing Sir Ross's recommendations as the Group continues to
develop lessons learned based on insight from customers and
stakeholders.
While Covid-19 presents an immediate challenge, climate change
remains one of the biggest issues facing the UK and indeed the
world today. We have made it clear that we want to play our part in
finding solutions to create a greener future.
I am pleased to be able to update you on the strong progress we
have made on our sustainability strategy. This strategy, set out in
2018, recognises that Lloyds Banking Group has a unique position
within the UK economy and this makes us well placed to support
customers and clients to manage both the opportunities and risks
posed by climate change. Our strategy supports the ambitions of the
global Paris Agreement and the targets of the UK Government's Clean
Growth Strategy.
Our goal is to be a leader in supporting the UK to successfully
transition to a more sustainable, low carbon economy. We have set
ourselves seven clear ambitions anchored to the objectives laid out
in the UK Government's Clean Growth Strategy including, for
example, supporting our clients to transition to sustainable
business models and operations, financing the shift to low emission
vehicles and to be a leading UK provider of customer support on
energy efficient and sustainable homes. As a signal of our
commitment, in January we announced an ambitious goal to work with
customers, Government and the market to help reduce the carbon
emissions we finance by more than 50 per cent by 2030, supporting
the UK's ambition to be net zero on carbon emissions by 2050.
In 2019 we made significant progress, reaching our 2020 targets
to support 5 million homes that can be powered through UK renewable
energy projects and use of green loans to fund commercial real
estate space to become more energy efficient, both a year early. We
have provided over GBP4.9bn in Green Finance since 2016, including
raising over GBP2.8 billion in green bonds for our UK corporate
issuers - more than any other UK financial services company.
Our sustainability strategy and our achievements continue to be
well recognised. We were ranked as a "leader" and 2nd in Europe by
ShareAction's '2019 Banking on a Low Carbon Future' and are the
only UK Bank to be ranked in the CDP A List for 2018 and 2019, an
independent analysis which names the world's most pioneering
companies on environmental transparency and performance.
Looking ahead we are committed to announcing more products and
services in 2020 that will help support a greener future for the
UK. We want to help our customers make the lifestyle changes
required in their homes, vehicles and investments by creating green
products and services that make it easier for them to invest in
tackling climate change. We will also support businesses by
financing their investments in the green economy, as well as
helping to improve the energy efficiency of commercial
buildings.
Identifying and managing climate-related risks and disclosing
these in line with the Taskforce for Climate Related Financial
Disclosure (TCFD) framework is a key priority. We are making
progress in this area and in our 2019 annual report disclosed our
exposure to high carbon sectors, which is low at less than 0.5% of
total loans and advances to customers. We have also updated our
existing sector statements, tightening our coal sector appetite,
and have introduced new positions on six additional sectors. We are
on track for full disclosure in line with TCFD by 2022.
We recognise that improving our own environmental footprint is
an important foundation for sustainability activity at Lloyds
Banking Group. For example, we have reduced our operational carbon
emissions by 63%, avoiding over 1.7 million tonnes of carbon
entering the atmosphere - this is equivalent to taking 360,000 cars
off the road.
We know there is more to do, and we are continually improving,
but our ambition to finance a greener future for the UK is
clear.
I would like to conclude where we started. Covid-19 represents
an unprecedented challenge for the Group, and the whole of the UK.
We have faced many challenges and we will all continue to be tested
over the weeks and months ahead. However, I have great confidence
in the resilience of our business model, the strength of our
balance sheet and most importantly the dedication of our
colleagues.
For further information:
Investor Relations
Douglas Radcliffe
Group Investor Relations Director
Email: douglas.radcliffe@lloydsbanking.com +44 (0) 20 7356 1571
Group Corporate Affairs
Matt Smith
Head of Media Relations
Email: matt.smith@lloydsbanking.com +44 (0) 20 7356 3522
Forward looking statements
This document contains certain forward looking statements within
the meaning of Section 21E of the US Securities Exchange Act of
1934, as amended, and section 27A of the US Securities Act of 1933,
as amended, with respect to the business, strategy, plans and/or
results of Lloyds Banking Group plc together with its subsidiaries
(the Group) and its current goals and expectations relating to its
future financial condition and performance. Statements that are not
historical facts, including statements about the Group's or its
directors' and/or management's beliefs and expectations, are
forward looking statements.
Words such as 'believes', 'anticipates', 'estimates', 'expects',
'intends', 'aims', 'potential', 'will', 'would', 'could',
'considered', 'likely', 'estimate' and variations of these words
and similar future or conditional expressions are intended to
identify forward looking statements but are not the exclusive means
of identifying such statements.
Examples of such forward looking statements include, but are not
limited to: projections or expectations of the Group's future
financial position including profit attributable to shareholders,
provisions, economic profit, dividends, capital structure,
portfolios, net interest margin, capital ratios, liquidity,
risk-weighted assets (RWAs), expenditures or any other financial
items or ratios; litigation, regulatory and governmental
investigations; the Group's future financial performance; the level
and extent of future impairments and write-downs; statements of
plans, objectives or goals of the Group or its management including
in respect of statements about the future business and economic
environments in the UK and elsewhere including, but not limited to,
future trends in interest rates, foreign exchange rates, credit and
equity market levels and demographic developments; statements about
competition, regulation, disposals and consolidation or
technological developments in the financial services industry; and
statements of assumptions underlying such statements.
By their nature, forward looking statements involve risk and
uncertainty because they relate to events and depend upon
circumstances that will or may occur in the future.
Factors that could cause actual business, strategy, plans and/or
results (including but not limited to the payment of dividends) to
differ materially from forward looking statements made by the Group
or on its behalf include, but are not limited to: general economic
and business conditions in the UK and internationally; market
related trends and developments; fluctuations in interest rates,
inflation, exchange rates, stock markets and currencies; any impact
of the transition from IBORs to alternative reference rates; the
ability to access sufficient sources of capital, liquidity and
funding when required; changes to the Group's credit ratings; the
ability to derive cost savings and other benefits including, but
without limitation as a result of any acquisitions, disposals and
other strategic transactions; the ability to achieve strategic
objectives; changing customer behaviour including consumer
spending, saving and borrowing habits; changes to borrower or
counterparty credit quality; concentration of financial exposure;
management and monitoring of conduct risk; instability in the
global financial markets, including Eurozone instability,
instability as a result of uncertainty surrounding the exit by the
UK from the European Union (EU) and as a result of such exit and
the potential for other countries to exit the EU or the Eurozone
and the impact of any sovereign credit rating downgrade or other
sovereign financial issues; political instability including as a
result of any UK general election; technological changes and risks
to the security of IT and operational infrastructure, systems, data
and information resulting from increased threat of cyber and other
attacks; natural, pandemic (including but not limited to the
coronavirus disease (COVID-19) outbreak) and other disasters,
adverse weather and similar contingencies outside the Group's
control; inadequate or failed internal or external processes or
systems; acts of war, other acts of hostility, terrorist acts and
responses to those acts, geopolitical, pandemic or other such
events; risks relating to climate change; changes in laws,
regulations, practices and accounting standards or taxation,
including as a result of the exit by the UK from the EU, or a
further possible referendum on Scottish independence; changes to
regulatory capital or liquidity requirements and similar
contingencies outside the Group's control; the policies, decisions
and actions of governmental or regulatory authorities or courts in
the UK, the EU, the US or elsewhere including the implementation
and interpretation of key legislation and regulation together with
any resulting impact on the future structure of the Group; the
ability to attract and retain senior management and other employees
and meet its diversity objectives; actions or omissions by the
Group's directors, management or employees including industrial
action; changes to the Group's post-retirement defined benefit
scheme obligations; the extent of any future impairment charges or
write-downs caused by, but not limited to, depressed asset
valuations, market disruptions and illiquid markets; the value and
effectiveness of any credit protection purchased by the Group; the
inability to hedge certain risks economically; the adequacy of loss
reserves; the actions of competitors, including non-bank financial
services, lending companies and digital innovators and disruptive
technologies; and exposure to regulatory or competition scrutiny,
legal, regulatory or competition proceedings, investigations or
complaints. Please refer to the latest Annual Report on Form 20-F
filed by Lloyds Banking Group plc with the US Securities and
Exchange Commission for a discussion of certain factors and risks
together with examples of forward looking statements.
Lloyds Banking Group may also make or disclose written and/or
oral forward looking statements in reports filed with or furnished
to the US Securities and Exchange Commission, Lloyds Banking Group
annual reviews, half-year announcements, proxy statements, offering
circulars, prospectuses, press releases and other written materials
and in oral statements made by the directors, officers or employees
of Lloyds Banking Group to third parties, including financial
analysts.
Except as required by any applicable law or regulation, the
forward looking statements contained in this document are made as
of today's date, and the Group expressly disclaims any obligation
or undertaking to release publicly any updates or revisions to any
forward looking statements contained in this document to reflect
any change in the Group's expectations with regard thereto or any
change in events, conditions or circumstances on which any such
statement is based. The information, statements and opinions
contained in this document do not constitute a public offer under
any applicable law or an offer to sell any securities or financial
instruments or any advice or recommendation with respect to such
securities or financial instruments.
This information is provided by RNS, the news service of the
London Stock Exchange. RNS is approved by the Financial Conduct
Authority to act as a Primary Information Provider in the United
Kingdom. Terms and conditions relating to the use and distribution
of this information may apply. For further information, please
contact rns@lseg.com or visit www.rns.com.
END
AGMSEWFEFESSEEI
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May 21, 2020 08:29 ET (12:29 GMT)
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