Lloyds Bank profits are set to swell when it announces its half-year results on Thursday.
The lender’s bottom line is expected to rise by almost a fifth according to analysts.
Profit before tax is forecast to be £2.9bn, with the firm paying a £1.6bn, or 1p per share, dividend, Investec said.
Lloyds performance has been hampered by large compensation payouts for PPI mis-selling. It is anticipated to set aside a further £400m more in costs. So far it has paid out more than £17bn in redress since 2011.
In June, competition watchdogs gave the thumbs up to Lloyds' £1.9bn takeover of US credit card firm MBNA.
Accendo Markets analysts compared Lloyds’ “generous dividends” with Royal Bank of Scotland, which is yet to return to paying dividends. They highlighted a comparatively small investment banking division means lower risk and less impact from Brexit.