Company: LLOBF
Filing Date: 2025-02-20
Form Type: 6-K
Source: 0001654954-25-001688
Chunk: 33

Company: Lloyds Banking Group plc
Filing Date: 2025-02-20
Form: 6-K
Chunk 33
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 from the expected return is included within insurance volatility. This is because movements in their value can have a significant impact on the profitability of the Group. Management believes that it is appropriate to disclose the results on the basis of an expected return.

The Group manages its Insurance business exposures to equity, interest rate, foreign currency exchange rate and inflation movements within the Insurance, Pensions and Investments division. It does so by balancing the importance of managing the impacts to both Solvency capital and earnings volatility, as these factors can impact the dividend that the Insurance business can pay up to Lloyds Banking Group plc. This approach can result in volatility in statutory profit before tax. Total insurance volatility resulted in losses of £336 million (2023: £108 million), driven by increases in interest rates and equity performance.

DIVISIONAL RESULTS (continued)

#### Equity Investments and Central Items
|                                     | 2024 
   £m |     | 2023 
   £m |     | Change 
      % |
| Underlying net interest income      |  617 |     |  451 |     |     37 |
| Underlying other income             |   96 |     |   64 |     |     50 |
| Net income                          |  713 |     |  515 |     |     38 |
| Operating costs                     | -160 |     | -144 |     |    -11 |
| Remediation                         |  -26 |     |  -19 |     |    -37 |
| Total costs                         | -186 |     | -163 |     |    -14 |
| Underlying profit before impairment |  527 |     |  352 |     |     50 |
| Underlying impairment               |    3 |     |    5 |     |    -40 |
| Underlying profit                   |  530 |     |  357 |     |     48 |

Equity Investments and Central Items includes the Group's equity investments businesses, including Lloyds Development Capital (LDC), the Group's share of the Business Growth Fund (BGF) and the Housing Growth Partnership (HGP), as well as Lloyds Living. Also included are income and expenses not attributed to other divisions, including residual underlying net interest income after transfer pricing (which includes the recharging to other divisions of the Group's external AT1 distributions), and the unwind of hedging costs relating to historic gilt sales.

Net income in 2024 was higher compared to