Company: LLOBF
Filing Date: 2025-07-24
Form Type: 6-K
Source: 0001654954-25-008460
Chunk: 31

Company: Lloyds Banking Group plc
Filing Date: 2025-07-24
Form: 6-K
Chunk 31
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           12 |     |           96 |     |           10 |
| Insurance hedging arrangements    |          -57 |     |         -324 |     |         -118 |
| Total1                            |          -45 |     |         -228 |     |         -108 |

1 Total insurance volatility is included within market and other volatility, which in total resulted in a gain of £27 million in the half-year to 30 June 2025 (half-year to 30 June 2024: loss of £65 million; half-year to 31 December 2024: loss of £79 million). See page 31.

Insurance volatility impacts statutory profit before tax (through market and other volatility) but does not impact underlying profit, which is based on an expected return. The impact of the actual return differing 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 £45 million (half-year to 30 June 2024: losses of £228 million; half-year to 31 December 2024: losses of £108 million), driven by increases in interest rates and decreases in inflation.

DIVISIONAL RESULTS (continued)

#### Equity Investments and Central Items
|                                       | Half-year to 
       30 Jun 
         2025 
           £m |     | Half-year to 
       30 Jun 
         2024 
           £m |     | Change 
      % |     | Half-year to 
       31 Dec 
         2024 
           £m |     | Change 
      % |
| Underlying net interest income        |          258 |     |          286 |     |    -10 |     |          331 |     |    -22 |
| Underlying                            
 other income1                         |           78 |     |           10 |     |        |     |          126 |     |    -