LLOYDS’ chief yesterday began to set out his plans to start paying out dividends to shareholders, indicating he feels close to resolving the taxpayer-backed lender’s huge range of problems from the financial crisis.
The bank was brought down by taking over broken bank HBOS, but has since faced extra costs including £6.7bn set aside for PPI compensation payouts. But boss Antonio Horta Osorio yesterday insisted the problems are almost at an end, allowing the bank to consider returning cash to shareholders.
“As we finish our legacy issues, the profitability of the bank is going to increase a lot in the future, and, given we don’t have a usage for those funds, it is obvious that Lloyds will be a high dividend-paying stock in the future, as it has been in the past,” the chief executive told the Sunday Telegraph.
“It is our duty and our relentless goal to get this bank back to normal as soon as possible — which means profitable, lending to the economy, and without legacy issues in order to pay dividends and in order to be returned to the private sector.”
Lloyds’s shares have soared in the last year, more than doubling from a low of 24.75p last June to hit 52.91p on Friday, reflecting investors’ greatly improved view of the bank’s earning potential.
However the bank has had more problems recently – its forced sale of 623 branches to the Co-operative fell through last week, leaving it looking for a new buyer to replace the £750m arrangement.