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Lloyds Banking Slips To Pre-tax Loss In H1; Reports Early Signs Of Recovery In Core Markets

Lloyds Banking Group plc (LLOY.L,LYG) reported Thursday that its first-half loss before tax was 602 million pounds, compared to last year's profit of 2.90 billion pounds.

Profit after tax was 19 million pounds, down 99 percent from 2.23 billion pounds last year. On a per share basis, the company recorded loss of 0.3 pence, compared to prior year's profit of 2.7 pence.

The latest results included impairment charge of 3.8 billion pounds, including 2.4 billion pounds in the second quarter primarily reflecting a significant deterioration in forward looking economic outlook.

Underlying loss was 281 million pounds, compared to income of 4.19 billion pounds a year ago.

Net income declined 16 percent to 7.41 billion pounds from 8.82 billion pounds a year ago.

Net interest income fell 11 percent to 5.48 billion pounds from 6.15 billion pounds a year ago.

Banking net interest margin was 2.59 percent, down 31 basis points from 2.90 percent last year.

Looking ahead for fiscal 2020, the company expects net interest margin to remain broadly stable on the second quarter level at about 240 basis points for the rest of the year resulting in a full year margin of about 250 basis points. Operating costs will be below 7.6 billion pounds, and impairment is expected to be between 4.5 billion pounds and 5.5 billion pounds.

The company said there have been early signs of recovery in the Group's core markets, mainly in consumer spending and the housing market, but the outlook remains highly uncertain.

The bank said the impact of lower rates and economic fragility will continue for at least the rest of the year.

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