Lloyds finally pays out dividends on £1.7bn profits

Some good news for the troubled bank’s investors

After six years of financial turmoil, Lloyds Banking Group has paid out dividends to shareholders.

The bank’s turnaround has been dramatic – from being bailed out to the tune of £20bn by the taxpayer in 2008 to paying £535m in dividends to its 2.7m shareholders (the largest shareholder base in the UK).

Lloyds will be paying out 0.75p a share after profits rose fourfold to £1.7bn.

The Payment Protection Insurance (PPI) scandal has cost the bank more than £12bn in total, including the £700m set aside from last year’s profits.

Chancellor George Osborne said: “For the first time ‎since its £20bn bailout in 2008, Lloyds bank has made a profit and will start paying a dividend to its shareholders.

“This is good news not only for taxpayers, who will get at least another £100m from the dividend, but also for millions of savers who hold Lloyds shares or have money invested in Lloyds through their pensions.”

Bonuses

Lloyds boss António Horta-Osório has been awarded a £11.5m pay deal for his work in turning the beleaguered financial institution around.

Horta-Osório is one of the 11 members of the management team which took over in 2011 to receive a combined £30m in bonuses.

These bonuses were decided on in 2012 and linked to Lloyds’s financial performance. The bank’s value has tripled since the team was installed.

2012 and 2013 bonuses are still being withheld from the management team while the Financial Conduct Authority investigates the bank’s handling of PPI complaints.

While some campaigners argued Horta-Osório’s pay is too high for a part-state-owned bank, business leaders backed the pay award.

CBI director John Cridland said: “It is encouraging to hear some good news from the banking sector.

“All of our major banks are on difficult turnaround journeys and Lloyds have shown that progress is possible.

“It is right in these circumstances that the hard work of staff is recognised.

“The CBI has been clear that rewards for failure are unacceptable but legitimate financial rewards for success should not be vilified.”

Complaints

But it’s not all good news for Lloyds – it’s been revealed the company has come top of a list of the most complained about banks.

The Financial Ombudsman Service, which investigates and mediates disputes between banks and customers, has reported Lloyds received more than 24,245 complaints in the second half of 2014.

This is actually a fall from 30,768 in the previous six months but the uphold rate has risen from 66% to 74% and it still puts Lloyds top of the table compared with the other banks.

The second most complained about was Barclays with 21,078 complaints, followed by RBS at 19,706 and HSBC at 11,345.

PPI was one of the top complaints across all banks, responsible for 65% of cases referred to the ombudsman.

NOW READ:

Magician cards

Fraudulent arms companies charged taxpayers for magicians, croquet and speeding fines


Odeon

Odeon cinemas set to go on sale priced at a whopping £1bn


Maersk 1

Biggest boat to ever navigate Thames docks at London Gateway

Readers' comments (1)

  • £12 million is a lot of money, but if it saves the UK billions, it is a spit in the ocean. Maybe we should pay our MPs and top civil servants a lot more, and get outstanding people, instead of the time servers and party hacks we have at the moment.

    Unsuitable or offensive? Report this comment

Social Bookmarks