Lloyds Banking Group plc (LYG) Q2 2022 Earnings Call Transcript

For the period ending June 30, 2022

July 27, 2022 4:30 a.m. ET

Prepared Remarks

Questions and Answers

Call Participants

Prepared Remarks:

Operator

Thank you for standing by, and welcome to the Lloyds Banking Group 2022 Half Year Results Call. [Operator Instructions] There will be presentations from Charlie Nunn and William Chalmers, followed by a question-and-answer session. [Operator Instructions] Please note this call is scheduled for 90 minutes and is being recorded.

I will now hand over to Charlie Nunn. Please go ahead.

Charlie Nunn

Good morning, everyone and thank you for our half year results call. As you know, our purpose as an organization is to help Britain Prosper. And despite the uncertain external environment, we see significant resilience within our customer franchise and our financial strength positions us well to continue to focus on this as we go forward. I will talk more about this shortly, but let me begin though by turning to Slide 3.

I'm going to take you through the key messages from the half, and then William will give the usual review of the Group's financial performance before we open up for Q&A.

There are five key messages that I'd like you to take away from today. First, in the context of the cost of living stress, we are seeing our customers adapting their spending where needed and taking the decisions required to maintain their financial resilience. We've delivered a strong financial performance in the first half of 2022 based on improved income, increased investment and benign asset quality alongside continued business momentum.

Our financial performance in half one has enabled us to enhance guidance for 2022. William will go through this in more detail later, although I should note that as usual, we are not going to give updated guidance for 2023 or 2024 at the half year. We're confident in the future and executing well, but it's simply too early to update longer-term numbers.

The financial performance has also enabled the Board to announce an interim ordinary dividend of 0.80 pence per share, up around 20% on last year. And finally, our strategic delivery and conservative risk business model positioned the Group well for the future.

So with that, I'll now turn to Slide 4 to look at how we are well-positioned to navigate the external uncertainties. It is clear that our customers are facing a challenging period with increases in the cost of living. However, given the nature of our customer base, the positioning of our balance sheet and our conservative risk appetite, we see a resilient franchise today and looking forward. We're not currently seeing signs of stress in the portfolio, and our business is well placed.