Company: LLOBF
Filing Date: 2025-02-20
Form Type: 6-K
Source: 0001654954-25-001688
Chunk: 41

Company: Lloyds Banking Group plc
Filing Date: 2025-02-20
Form: 6-K
Chunk 41
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 Other regulatory adjustments2                     |    -4,127 |     |    -4,012 |
| Total exposure measure                            |   674,074 |     |   647,634 |
| UK leverage ratio                                 |       5.5 
         % |     |      5.8% |
| Leverage exposure measure (including central bank 
 claims)                                           |   736,470 |     |   725,259 |
| Leverage ratio (including central bank claims)    |       5.1 
         % |     |      5.2% |
| Total MREL resources                              |    72,223 |     |    69,905 |
| MREL leverage ratio                               |   10.7  % |     |     10.8% |

1 Deconsolidation adjustments relate to the deconsolidation of certain Group entities that fall outside the scope of the Group's regulatory capital consolidation, primarily the Group's Insurance business.

2 Includes adjustments to exclude lending under the Government's Bounce Back Loan Scheme (BBLS).

#### Analysis of leverage movements
The Group's UK leverage ratio reduced to 5.5 per cent (31 December 2023: 5.8 per cent) reflecting the reduction in the total tier 1 capital position and the increase in the leverage exposure measure following lending growth and increases across securities financing transactions and other assets (excluding central bank claims).

### CREDIT RISK

#### Overview
The Group's portfolios are well positioned to benefit from an improved, but still challenging macroeconomic environment. The Group maintains a prudent approach to credit risk appetite and risk management, with strong credit origination criteria including evidence of affordability and robust LTVs in the secured portfolios.

Asset quality remains strong with improved credit performance in the year. In UK mortgages and unsecured portfolios, reductions in new to arrears and flows to default have been observed in 2024. Securitisations of primarily legacy Retail mortgages, totalling £2.0 billion of gross loans and advances to customers, during the second and fourth quarter will help mitigate credit risks in higher risk assets. Credit quality remains broadly stable and resilient in Commercial Banking. The Group continues to monitor the impacts of the economic environment carefully through a suite of early warning indicators and governance arrangements that ensure risk mitigating action plans are in place to support customers and protect the Group's positions.

The underlying impairment charge in 2024 was £433 million, increasing from a charge of £308 million in