Five questions answered on Lloyd Bank’s large pre-tax losses

£570m loss for 2012.

Lloyd Banking Group today posted huge pre-tax losses for 2012. We answer five questions on Lloyd’s current losses.

What’s the amount of Lloyd’s pre-tax losses?

The 39 per cent state owned group is reporting a £570m loss for 2012.

Why so much?

The bank set aside a £1.8bn rise in mis-selling provisions last year, which has dented its profit margins. Last week, it was also fined £4.3m for delaying compensation payments to customers over PPI mis-selling.

However, take away the money set aside for the mis-selling claims - £1.5bn for payment protection insurance and £310m for interest rate swaps – the lender said underlying pre-tax profit jumped from £638m to £2.6bn.

The consumer association Which? estimate that the bank’s latest update took the total amount set aside for PPI by the industry to £15bn.
Will Lloyd’s bankers still be getting their bonuses? 

Most likely. The bank has set aside £365m to pay staff bonuses and would hand its chief executive, Antonio Horta-Osorio, a deferred share award worth £1.49m.

"I came here with the main objective of getting taxpayers' money back and, therefore, I thought it would be appropriate to make my bonus entirely conditional to us getting to the taxpayer entry price," Lloyd’s Chief Executive Mr Horta-Osorio told journalists.

What else has he said in regards to this pre-tax loss?

In Lloyds’s annual report statement he said:

"Since setting out our strategy in June 2011, we have significantly strengthened the balance sheet and substantially improved efficiency and focus, while continuing to work through legacy issues.

"We are investing in our simple, lower-risk, customer-focused UK retail and commercial banking model, and in value-for-money products and better capabilities to continue to support UK households, businesses and communities."

What have the experts said?

The figures provided good news for the government former investment banker Heather McGregor told the BBC . "We hear that the government is looking to exit sooner rather than later, and if I was the government I would be doing that. I'd be looking at these figures going 'yes, I can get my money back much quicker'," she said.

Lloyd Banking Group today posted huge pre-tax losses for 2012. Photograh: Getty Images

Heidi Vella is a features writer for

Show Hide image

En français, s'il vous plaît! EU lead negotiator wants to talk Brexit in French

C'est très difficile. 

In November 2015, after the Paris attacks, Theresa May said: "Nous sommes solidaires avec vous, nous sommes tous ensemble." ("We are in solidarity with you, we are all together.")

But now the Prime Minister might have to brush up her French and take it to a much higher level.

Reuters reports the EU's lead Brexit negotiator, Michel Barnier, would like to hold the talks in French, not English (an EU spokeswoman said no official language had been agreed). 

As for the Home office? Aucun commentaire.

But on Twitter, British social media users are finding it all très amusant.

In the UK, foreign language teaching has suffered from years of neglect. The government may regret this now . . .

Julia Rampen is the editor of The Staggers, The New Statesman's online rolling politics blog. She was previously deputy editor at Mirror Money Online and has worked as a financial journalist for several trade magazines.