Company: LLOBF
Filing Date: 2025-07-24
Form Type: 6-K
Source: 0001654954-25-008460
Chunk: 44

Company: Lloyds Banking Group plc
Filing Date: 2025-07-24
Form: 6-K
Chunk 44
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 at 2.3% (31 December 2024: 2.4%)

● Continued stable credit performance in addition to strong application volumes resulted in a reduction in Retail Stage 3 loans and advances to 1.8% of total loans and advances (31 December 2024: 1.9%)

● Retail Stage 3 ECL coverage reduced to 13.4% (31 December 2024: 14.1%) largely as a result of a reduction in coverage for UK Mortgages following improvements to the outlook for house price growth

UK mortgages

● The UK mortgages portfolio increased to £318.7 billion (31 December 2024: £313.3 billion) driven by strong customer demand

● New to arrears in the UK mortgages portfolio have improved in the first half of 2025. The portfolio remains well positioned with a strong loan to value (LTV) profile. The Group has actively improved the quality of the portfolio in recent years using robust affordability and credit controls, while the balances of higher risk legacy vintages continue to reduce

● The impairment release of £133 million for the first half of 2025 is broadly in line with the release of £119 million in the first half of 2024. Underlying performance remains stable with both years also benefitting from favourable updates to the economic outlook, with additional judgement reductions resulting in slight favourability in 2025

● Stage 2 loans and advances have reduced to 11.0% (31 December 2024: 11.6%) following updates to the Group's macroeconomic outlook, and a combination of stable credit performance with strong application volumes

● Continued stable credit performance in addition to strong application volumes also resulted in a reduction in Stage 3 loans and advances to 1.9% (31 December 2024: 2.1%), with improvements to the outlook for house price growth resulting in a reduction in Stage 3 ECL coverage to 9.1% (31 December 2024: 10.1%)

CREDIT RISK (continued)

#### UK mortgages product analysis - statutory basis
|                                                   | At 30 June 2025 |     |            |        |     |            |       |     |       |         |            |     | At 31 December 2024 |     |            |        |     |            |       |     |       |         |
| Mainstream                                        |                 |     | Buy-to-let |        |     | Specialist