Halifax boosts Lloyds performance

Halifax's TV adverts include The Wizard of Oz
Halifax's TV adverts include The Wizard of Oz
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Lloyds Banking Group has shrugged off concerns over Brexit to unveil a £4bn dividend and share buyback bonanza for investors after a strong performance from its Halifax Bank division.

Lloyds, Britain’s biggest mortgage lender, reported a 24 per cent rise in net profits to £4.4bn in 2018, which was slightly below expectations of £4.6bn.

The bank’s confident tone on the economy struck a contrast with rivals Royal Bank of Scotland and HSBC, which in the last week both reported taking provisions against Brexit amid concerns bad loans could rise.

Lloyds rejected any suggestion of complacency in its outlook for the economy, saying it recognises uncertainties exist.

Lloyds’ chief executive Antonio Horta Osorio said he expects to see a last minute accord between Prime Minister Theresa May and the EU on the future trading relationship between Britain and the bloc.

“We are planning for a deal and a smooth Brexit transition that should lead the economy to grow at around the same pace you have now of about 1 to 1.5 per cent,” he said.

“Of course other scenarios can play out. Irrespective of that our business model is the right one and it is true that we face the future with confidence, otherwise we would not be ramping up our investment in this business.”

Lloyds is investing heavily in its award-winning Halifax Bank division.

Russell Galley, managing director of Halifax, said: “Halifax continues to support Lloyds Banking Group’s strong performance through our commitment to making customers better off.

“Our Halifax Savers Prize Draw paid out £7.6m to customers in 2018, and has now given out a total prize fund of £56m since it launched in 2011.

“We also became the first bank to achieve more than a million switchers through the Current Account Switching Service CASS since it began in September 2013.“

Halifax has rewarded customers with £34.5m in cashback through its mortgage and switcher campaigns featured alongside the stars of its TV adverts, including The Wizard of Oz.

Mr Galley said: “This also included our £1,000 cashback campaign – supporting the group’s pledge to lend £30bn to first time buyers by 2020 by helping more people to take their first step on to the property.“

In London, Halifax has opened the doors of its first flagship branch which is open 76 hours per week.

“The 13,500 sq ft new-look space is designed around what our customers want and includes a travel zone, home hub and a kids savings area,” said Mr Galley.

“We invested £66m across our branch network to help us better serve customers when and where suits them, whether it’s talking to colleagues about their more complex needs in branch and through our remote adviser service, or online through our top-rated, easy to use mobile app.

“I’m incredibly proud of the energy, enthusiasm and dedication I see from the Halifax team every day with our customers, and this has once again been recognised with a number of awards including best service from a mortgage provider by Moneyfacts, Your Money’s best overall mortgage lender for the 17th year running and the Personal Finance Awards’ best savings and credit card provider.“

Lloyds has spent £1bn on digitising its business and bulking up its wealth management operations, as it seeks to expand into the financial planning and retirement market.

The group has set aside a further £200m to compensate customers mis-sold PPI.