Britain's state-rescued Lloyds Banking Group announced Friday that net profits sank by a fifth in the first quarter, after taking a charge against the disposal of its TSB retail division. Earnings after taxation slid to £913 million ($1.40 billion, 1.25 billion euros) in the three months to the end of March, compared with £1.148 billion a year earlier, Lloyds said in a results statement.
However, pretax profit before exceptional items rose 21 percent to £2.2 billion in the reporting period boosted also by falling bad debts. That beat expectations of £2.0 billion, according to analysts polled by Bloomberg. Lloyds - almost 21-percent state-owned after a bailout in the global financial crisis - took a £660-million charge linked to the sale of TSB to Spain's Banco de Sabadell. That partly reflected the cost of switching TSB to an alternative IT platform.
The mixed results were published one week after Britain's government sold another tranche of Lloyds, as it seeks to further cut the deficit before the general election on May 7. British Prime Minister David Cameron has pledged to offer up to £4 billion worth of Lloyds shares to small investors at below-market prices, if his Conservative party wins next week.
Cameron's centre-right Conservatives, in power since 2010 as part of a coalition administration, are neck and neck with the opposition Labour party in opinion polls. Meanwhile, Lloyds added Friday that revenues grew 3.0 percent to £4.6 billion in the reporting period.
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