The FTSE 100 lender said pre-tax profit increased by 12% in 2025, comfortably beating analysts’ expectations of £6.4 billion and exceeding the £5.97 billion recorded in 2024, News.Az reports, citing foreign media.
The results came despite accelerating interest rate cuts, after the Bank of England reduced its base rate by a full percentage point over the year.
Net interest income rose 6% year on year to £13.6 billion, compared with 2024 when interest rates stood at a post-financial-crisis high of 5.25%. Overall income increased 7% to £18.3 billion, reflecting what the bank described as resilient performance.
Lloyds said it would return additional capital to shareholders through the £1.75 billion buyback, taking total distributions for the 2025 financial year to around £3.9 billion. The group also raised its ordinary dividend by 15% year on year to 3.65 pence per share, including a final dividend of 2.43 pence.
Chief executive Charlie Nunn said the bank’s continued momentum allowed it to upgrade its outlook. “Looking ahead to 2026 and the culmination of the five-year strategy we set out in 2022, our continued business momentum and strategic delivery enable us to upgrade guidance,” he said, adding that the group is “well positioned for 2026 and beyond.” Lloyds plans to outline the next phase of its strategy next year.
The results also showed remediation costs of £968 million, including £800 million set aside to cover the potential impact of motor finance commission arrangements. Underlying impairment charges rose to £795 million from £433 million a year earlier, which the bank said reflected strong and stable credit performance. Impairments were broadly flat at £177 million in the fourth quarter.
Lloyds also raised its profitability ambitions, saying it now expects to achieve a return on tangible equity of more than 16% in 2026, compared with a previous forecast of 12% for 2025.
