Wednesday, May 2, 2012

Bear nibble

Funding costs drive Lloyds to slash loan book

"Lloyds unveiled an eight per cent drop in its need for wholesale funding in the first quarter, which now stands at £231bn and meets its targeted loan-to-deposit ratio of 130 per cent. The progress was so rapid that Horta-Osório set a new target of 120 per cent for this time next year.... The change was fuelled by a five per cent cut in lending to retail customers during the first quarter of this year, with retail assets reduced to £538bn, and a slight increase in customer deposits to £412bn... ...many analysts were disappointed by a drop in the bank’s net interest margins – the average margin it makes on lending – which was down by two basis points to 1.95 per cent due to increased funding costs, a key reason why the bank is deleveraging so quickly."

Posted by mark wadsworth @ 09:40 AM (2427 views)
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