Lloyds Banking Group reports 20% profit drop, plans £1.7bn buyback

Lloyds Banking Group reported a 20.4% drop in annual pre-tax profit for 2024, reaching £5.97 billion, significantly below analysts' expectations of £6.39 billion. The decline is attributed to interest rate cuts impacting lending margins and the sluggish economic recovery in Britain. The bank set aside an additional £700 million for potential payouts related to a motor finance scandal, bringing total provisions to £1.15 billion. Despite the profit slump, Lloyds announced a 15% increase in its dividend to 3.17 pence per share and plans for a share buyback program of up to £1.7 billion. In the fourth quarter, net income rose by 3.4% to £4.37 billion, but underlying profit fell by 43.1% year-on-year. CEO Charlie Nunn expressed confidence in the bank's strategy and its potential to generate additional income in the coming years.