Company: LLOBF
Filing Date: 2025-07-24
Form Type: 6-K
Source: 0001654954-25-008460
Chunk: 49

Company: Lloyds Banking Group plc
Filing Date: 2025-07-24
Form: 6-K
Chunk 49
---
-let at a level to fully repay the debt or generate sufficient income to meet the minimum interest cover requirements). Approximately 47% of exposures relate to commercial real estate, including c.13% secured by office assets, c.9% by retail assets and c.12% by industrial assets. Approximately 51% of the portfolio relates to residential lending

● Recognising this is a cyclical sector, total (gross and net) and asset type quantum caps are in place to control origination and exposure. Focus remains on the UK market and new business has been written in line with a prudent risk appetite criteria including conservative LTVs, strong quality of income and proven management teams. Development lending criteria also includes maximum loan to gross development value and maximum loan to cost

● Use of SRT securitisations also acts as a risk mitigant in this portfolio. Run-off of these is carefully managed and sequenced to avoid concentrations

### LIQUIDITY RISK

#### Overview
The Group has maintained its strong funding and liquidity position with a loan to deposit ratio of 95% as at 30 June 2025 (31 December 2024: 95%). Total wholesale funding was stable at £92.2 billion as at 30 June 2025 (31 December 2024: £92.5 billion). The Group maintains access to diverse sources and tenors of funding.

The Group's liquid assets continue to exceed the regulatory minimum and internal risk appetite, with a liquidity coverage ratio (LCR) 1 of 145% as at 30 June 2025 (31 December 2024: 146%) calculated on a Group consolidated basis based on the PRA rulebook. The decrease in the LCR resulted from a reduction in liquid assets, primarily driven by an increase in lending, offset by an increase in customer deposits. All assets within the liquid asset portfolio are hedged for interest rate risk. Following the implementation of structural reform, liquidity risk is managed at a legal entity level with the Group consolidated LCR representing the composite of the Ring-Fenced Bank and Non-Ring-Fenced Bank entities.

LCR eligible assets 1 have reduced to £131.8 billion (31 December 2024: £134.4 billion), primarily driven by an increase in lending, offset by an increase in customer deposits. In addition to the Group's reported LCR eligible assets, the Group maintains borrowing capacity at central banks which averaged £73 billion in the 12 months to 30 June 2025.