Lloyd’s Wealth and International branch was hit with an impairment charge of £1.4 billion in the first quarter of this year, as the bank felt the effects of its exposure to Irish real estate and vulnerable assets in Australasia, according to its Q1 2011 report, released today
by Sophie McBain
Lloyd’s Wealth and International branch was hit with an impairment charge of £1.4 billion in the first quarter of this year, as the bank felt the effects of its exposure to Irish real estate and vulnerable assets in Australasia, according to its Q1 2011 report, released today.
Lloyds Banking Group reported that although this impairment charge has fallen substantially in the last three months, it is significantly higher than in Q1 2010. Around 60 per cent of the group’s Irish portfolio is now impaired, with the total impairment charge for Ireland £500 million higher than Q1 last year.
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The Report did not mention Lloyd’s private banking arm in detail. However, last month’s recommendations by the Independent Commission on Banking to ring-fence retail and investment operations, as well as pressure on the Group to divest a further 600 branches, could drive up private banking fees.
The outlook for the rest of the bank was even gloomier, as Lloyds revealed a £3.47 billion statutory loss after tax having made provisions of £3.2 billion for payment protection insurance payout costs.
On a faint positive note, Britain’s largest part-nationalised bank reported progress in reducing its reliance on central bank funding.
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