Lloyds Banking Group PLC (LSE:LLOY) unveiled a £1 billion share buyback and a new four-year strategy after reporting a stronger profit for the second quarter than expected.
Statutory pre-tax profit rose to £4.3 billion in the first half, from £3.5 billion a year earlier. Second-quarter profit of £2.3 billion beat the £2.1 billion expected by analysts.
Underlying net interest income increased 9% to £7.3 billion. Its banking net interest margin, the difference between what the bank earns from loans and pays out on deposits, improved by 15 basis points to 3.19%, helped by structural hedge income and lending growth.
As well as the new buyback, the interim dividend was hiked 30% to 1.58p a share, equivalent to £918 million. Lloyds also announced a buyback of up to £1 billion, adding to the £1.75 billion programme unveiled with its 2025 results.
Chief executive Charlie Nunn said the bank had delivered "sustained strength in financial performance", with income growth, controlled costs and increasing shareholder returns.
Full-year guidance was left unchanged, including net interest income above £14.9 billion and a return on tangible equity above 16%.
Under the new Accelerate 2030 plan, Lloyds is targeting a return on tangible equity of around 20% and a cost-to-income ratio below 45% by 2030.
