Lloyds Banking stock slips as Q3 profit jumps, targets hold

Lloyds Banking Group reported stronger third-quarter profitability on Thursday, October 29, but kept its full-year targets unchanged. At 16:30:48 CEST on Friday, October 30, Lloyds Banking stock traded at 1.13 euros on Lang & Schwarz, 4.24 percent below the Xetra close of 1.18 euros from Thursday, October 29.

The EQS release published by Deutsche Boerse shows statutory pretax profit of 2.332 billion pounds for the three months ended September 30, up 99 percent year on year. The comparison benefited from the reduction of a 875 million pound remediation charge recorded in the prior-year quarter.

Income Growth And Margin Pressure

Net income rose 9 percent to 5.072 billion pounds, while underlying net interest income increased 10 percent to 3.806 billion pounds. The banking net interest margin improved to 3.25 percent from 3.06 percent, supported by stronger structural hedge income and lending growth.

Underlying quarterly profit rose 83 percent to 2.367 billion pounds, and the return on tangible equity reached 19.5 percent. Lloyds said competitive deposit conditions limited the pace of margin expansion, keeping funding costs central to the outlook.

Targets Remain In Place

For the first nine months, statutory profit after tax increased 46 percent to 4.835 billion pounds. Underlying net interest income reached 11.084 billion pounds, while the cost:income ratio improved to 47.2 percent in the third quarter.

Lloyds continues to target underlying net interest income above 14.9 billion pounds, a cost:income ratio below 50 percent, an asset quality ratio of about 25 basis points, return on tangible equity above 16 percent and capital generation above 200 basis points for 2026. The group also expects its CET1 ratio to move toward about 13.0 percent.

Customer loans reached 495.5 billion pounds at September 30, while deposits stood at 502.8 billion pounds. The bank is also beginning its Accelerate 2030 strategy, which targets mid-single-digit net income compound growth from 2027 through 2030.

Investors can follow the real-time quote of Lloyds Banking stock as expectations adjust to the unchanged targets and ongoing deposit competition.

The FTSE 100 provides the broader UK market setting for domestic banks and other large companies.

More news and analyses on Lloyds Banking stock will track the next earnings and guidance developments.