Lloyds Banking Group (LLOY) Q1 2026 earnings summary

Executive summary

• Delivered strong Q1 2026 financial performance with net income of £4.8bn, up 9% year-over-year and 1% sequentially, reflecting resilient business momentum, disciplined execution, and robust profitability as the group enters the final year of its current plan.

• Statutory profit after tax reached £1.6bn, up 37% year-over-year, with return on tangible equity at 17.0%.

• Maintained confidence in the business outlook and reiterated 2026 guidance, with a strategic update expected at half year.

• Strategic focus remains on income growth, operating leverage, and sustainable returns beyond 2026.

Financial highlights

• Net income reached £4.8bn, up 9% year-over-year and 1% sequentially; net interest income was £3.6bn, up 8% year-over-year.

• Statutory profit before tax rose 33% year-over-year to £2.0bn; profit after tax up 37% to £1.56bn.

• Cost:income ratio improved to 51.9% from 58.1% year-over-year, with operating costs at £2.5bn, down 3% year-over-year.

• Net interest margin rose to 3.17%, up 7bps sequentially and 14bps year-over-year.

• Tangible net asset value per share increased to 57.9p, up 0.9p quarter-on-quarter.

Outlook and guidance

• 2026 net interest income now expected to exceed £14.9bn, with structural hedge income forecast to grow by over £1.5bn to more than £7bn.

• Cost:income ratio targeted below 50% in 2026, with operating costs under £9.9bn.

• Asset quality ratio for 2026 anticipated at approximately 25bps.

• Return on tangible equity guidance for 2026 remains above 16%, with capital generation over 200bps and CET1 ratio targeted to pay down to around 13.0% by year-end.

• Progressive and sustainable ordinary dividend policy reaffirmed.