The lender said provision for the mis-selling of payment protection insurance was the “primary driver” of its statutory loss for the first nine months of 2012.

The bank has now set aside £2.1bn this year to cover PPI-related costs and £5.3bn in total.

The bank said today the volume of complaints are falling.

“By the time of our full year 2012 results announcement on 1 March 2013, we expect to have a higher degree of confidence in forecast trends and the ultimate likely cost of PPI,” said chief executive António Horta-Osório.

Lloyds, the largest mortgage lender in the UK, revealed it has committed to lend £500m of first-time buyer mortgages with the support of the government’s Funding for Lending Scheme (FLS).

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The lender said it was the first bank to draw on the scheme in September 2012, drawing down £1bn to help UK households and SMEs, and is expected to make additional drawings over the coming months.

The lender has helped 40,000 first-time buyers this year so far.

It also revealed its underlying profit rose by 148% to £1.9bn for the first nine months of the year, driven by decreasing impairment charges and improving cost efficiency.

A 14% fall in total underlying income, from £16.1bn to £13.8bn year-on-year, reflected “a smaller balance sheet as well as a lower net interest margin of 1.93%”.

The group confirmed it would not offer advice to customers with under £100,000 post-RDR.

“For customers who hold less than £100,000 in savings and investments we will not offer an investment advice service but will continue to give these customers information and help with savings products on a non-advised basis,” it said.