In its full-year results, the group announced that its underlying loans and advances to customers grew by £22bn or 5% to £481.1bn.
Lloyds Banking Group lent £17bn to more than 70,000 first-time buyers last year, supported by its first-time buyer boost mortgage proposition. It also reported a 32% lift in direct mortgage applications compared to the previous year, while the take-up of protection insurance rose by five percentage points to 20%.
Its UK mortgages portfolio rose from £313.3bn to £323.9bn, which it attributed to sustained customer demand.
There was an improvement in mortgage borrowers who were new to arrears, making up 1% of accounts compared to 1.3% the year before. Meanwhile, the group reduced its impairment charge from £194m in 2024 to £60m last year, owing to the macroeconomic outlook and growth in house prices.
Its stock of residential mortgages had an average loan-to-value (LTV) ratio of 44.47%, while new lending had an average LTV of 64.7%.
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Lloyds Banking Group’s net interest margin improved by 11 basis points to 3.06%.
The group reported a 6% rise in its profit after tax to £4.8bn.
Charlie Nunn, group chief executive of Lloyds Banking Group, said: “In 2025, we entered the second phase of our five-year strategy and continued to deliver for customers, shareholders and wider stakeholders. As our strategic transformation accelerates into 2026, we remain guided by our purpose of Helping Britain Prosper in driving positive change in areas where we can have impact at scale and create value.”
He said the group showed “sustained strength” in financial performance, with continued balance sheet and income growth, as well as strong cost discipline and credit performance.
Nunn added: “Looking ahead to 2026 and the culmination of the five-year strategy we set out in 2022, our continued business momentum and strategic delivery enable us to upgrade guidance. The sustained strength in performance means we are well-positioned for 2026 and beyond.
“Having entered this year on a positive trajectory, I look forward to sharing more detail on the next stage of the group’s strategy, beyond the current plan, in July.”
