Lloyds Banking Group posts £1.9bn profit despite Brexit

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 Lloyds Banking Group has reported that third-quarter profits have for the larger part remained unchanged since the previous financial year, confounding initial expectations of a sharp squeeze on earnings caused by Britain’s surprise vote to quit the European Union.

According to the company underlying pretax profits were £1.9 billion, slightly under the £1.97 billion booked in the corresponding period a year ago.Total income for the quarter was £4.3 billion, broadly in line with the third quarter  of 2015.Britain’s largest retail bank also booked a fresh £1 billion charge to compensate customers mis-sold loan insurance after the Financial Conduct Authority pushed back the claims deadline by a year to mid-2019. Lloyds also reported a £740 million deficit in its pension fund, which has been hit by falling bond yields in recent months.

Rescued in a £20.5 billion taxpayer bail-out during the financial crisis, Lloyds was the first major British bank to report results that fully capture the period after the referendum results.Chief executive Antonio Horta-Osorio is searching for ways to prop up Lloyds’ dividend and profits against a more testing economic enviornment and the effects of lower-for-longer interest rates caused by the vote to leave the EU.

Since June’s referendum, shares in Lloyds have fallen by about a quarter, partly reflecting their heavy exposure to any downturn in the British economy. Lloyds said total loans and advances to customers fell £1 billion to £452 billion compared to three months earlier.

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