Good morning, everyone, welcome to the Lloyds Banking Group 2026 Annual General Meeting. To those here in person and also to all those joining via the webcast, I'm Robin Budenberg, Chair of the Group, it's a pleasure to be back in Edinburgh. It was here in the late 17th century that Scottish merchants established the nation's first public bank, later known as the Bank of Scotland. Our Group now has more individual investors than almost any other U.K. business. With over 2 million shareholders, including many among our 28 million customers, we're one of the most widely held companies on the London Stock Exchange. In a short while, there'll be an opportunity for you to ask questions, after that we'll conduct the formal part of the meeting, including voting on the proposed resolutions.
Before then, I'd like to share an update on the board as well as my thoughts on the group's performance over the past year. This will be followed by reflections from Charlie Nunn, our Group Chief Executive, and Amanda Mackenzie, our Responsible Business Committee Chair. May I say upfront that we are all acutely aware of the pressures on households and businesses at the present time. This period of instability has rocked confidence and given rise to concern for people, for businesses, and for the economy as a whole. We hope to see a renewed collective focus on growth and long-term prosperity for every region and nation. At a time when the world feels more uncertain than ever before, we at Lloyds are resolute in supporting those we serve. We are transforming our group in order to better protect resilience and enable a stronger future.
We've had two changes to our board over the past 12 months. Last June, Chris Vogelzang joined as a non-executive director and member of the Responsible Business Committee. This April, he also joined the Board Risk Committee. Chris has deep expertise in retail and commercial banking, and I'm grateful to him as well as to all board members for their knowledge and foresight as part of our governance. I'd like to offer thanks to Scott Wheway, who stepped down from the board and as Chair of Scottish Widows Group at the end of October last year. We are grateful for his service and his support. Moving to the group's robust financial performance in 2025, which has set us up well for the final phase of our five-year strategy. During these five years, the group has improved cost and capital efficiency and returned to growth.
We have made important investments in our skills, digital capabilities, and value-added customer propositions. This ongoing transformation has enabled the delivery of strong returns for you, our shareholders. Having met the guidance we set for our financial performance in 2025 and having reported a statutory profit after tax for the full year of GBP 4.8 billion, we were pleased to announce a total ordinary dividend of GBP 0.0365 per share for 2025, an increase of around 15% on 2024 in line with our progressive and sustainable dividend policy. We've also announced a share buyback of up to GBP 1.75 billion to be completed by the end of 2026.
I'm sure that shareholders will have been pleased to see further improvement in our share price despite significant and ongoing geopolitical disruption and its inevitable impact on the U.K. economy. I believe this improvement reflects our resilient business model, consistent financial performance, and growing confidence in our medium-term outlook for higher, more sustainable returns. Last month, the group once again demonstrated sustained strength in our financial performance, growing income, maintaining cost discipline, and delivering strong profitability in the first quarter. We have also completed a detailed assessment of the FCA's recent announcement on the rules for an industry-wide redress scheme in relation to motor finance. Based on this analysis, we do not believe that any change to our existing provision is currently required. Our purpose is helping Britain prosper. This means creating the conditions for growth with sustained investment into our communities.
This is more important than ever when events of recent months have had considerable constraining impact on household budgets, business confidence, and the complex supply chains which underpin our economy. As the U.K.'s largest financial services provider with more than 28 million customers, we have a financial relationship with over half of the adults in the U.K. and over 1 million British businesses. A strong financial services sector is essential for a strong economy, fueling jobs, productivity, and economic growth, enabling security, confidence, and ambition for people and for businesses. We need to boost confidence in order to boost Britain. With a more competitive environment for investment and with the right regulatory reform, we can unleash the long-term value creation potential of financial services, which is needed now more than ever. We're committed to working closely with government and regulators to support this objective.
This year, we're committing GBP 35 billion of new finance for businesses across every region and nation of the U.K., with a third of that directed to small and medium-sized enterprises. We're proud to have doubled our provision of infrastructure finance since 2011, delivering major energy projects, new technologies, healthcare, and housing in partnership across public and private sectors. Recent events have intensified energy fears for every organization and household in the U.K. Back in January, I was in the northeast of England together with the team from Lloyds and many other investors, all supporting that region as it makes its mark as the U.K.'s energy coast, with particular renown for offshore wind and advancing rapidly in hydrogen and carbon capture.
Renewable energy is a strategic national asset, and we want to enable the northeast and other regions to power our futures, generating jobs and growth, which is why I'm so pleased that we've also extended our partnership with the Manufacturing Technology Centre, contributing over GBP 80 million in sponsorship until the end of 2029 and facilitating the creation of the new MTC training in Tyneside, a further investment into engineering and advanced manufacturing for tomorrow's industries. In all, we're proud to have provided GBP 71 billion in sustainable finance since 2011, including GBP 22 billion in 2025 alone.
Sustainable finance enables essential clean energy, water resilience, and food security projects from our role as one of the largest lenders for Sizewell C to issuing the U.K.'s first blue bond with GBP 250 million for the Thames Tideway Tunnel to supporting farmers to switch to more regenerative solutions. As the biggest lender to U.K. agriculture, we know that farmers are navigating greater climate, supply, and cost pressures, not least for fertilizer, than ever before. Our new agriculture transition finance product is creating valuable headroom for those on the front line of land management and secure food production. Our strategy is enabling us to bring more of our group to every customer, client, and community through innovative cross-sector partnerships and truly seamless connected experience. To achieve the latter, we're delivering the largest digital transformation in U.K. financial services, increasing financial security and empowerment for our customers.
Across our group, teams are combining the best talent and technology to provide people with the information that they need at the time that's right for them. Your credit score, for example, is one of the single biggest contributions to U.K. financial resilience, with 12 million people currently using this tool to measure their own credit health. Meanwhile, over 70% of the U.K.'s higher education institutions are supported by our commercial bank, thanks to our industry-leading digital platform, which simplifies cash management and payments. Last year, the strength of our platform capabilities secured a landmark contract for government banking services, handling 400 million transactions a year and connecting us to almost every household in the U.K. Delivering on our purpose and our strategy in such important ways would simply not be possible without the knowledge, care, and collaboration of colleagues right across our group.
We are committed to invest in their skills and ways of working, supporting colleagues to make the best possible contribution to our customers as they shape the future of our organization and financial services as a whole. With this in mind, we've launched our AI Academy for every single colleague, regardless of role or experience, helping 100% of our teams to develop strong AI literacy by the end of this year. I know that Charlie will reflect further on the immense potential for AI and digital assets in reshaping the future of finance. We want to ensure that every colleague has the tools and training they need in order to do so. We were recently credited as one of The Times top 10 graduate employers and recognized by LinkedIn as amongst the top large employers to grow your career in 2026.
Our employee engagement score is now at 75%, exceeding the industry benchmark for high-performing organizations in the U.K. I believe this reflects our close engagement of colleagues throughout our transformation journey, not least through our colleague networks and valued partnerships with our trade unions, Accord and Unite. May I conclude by thanking colleagues for their important efforts over the past year, supporting strong communities, resilience and growth. We are delivering for our customers and for our shareholders, and we are confident in our commitment to continue generating higher, more sustainable returns, building on our strategic progress to- date. Thank you. I'll now hand over to Charlie.
Thank you, Robin. Good morning to everyone here. We're all living through a period of significant instability and change economically, technologically and geopolitically. Despite the resilience of households and businesses in the U.K., recent events have again meant that many are having to navigate increased uncertainty and new cost pressures in their daily lives. Helping Britain Prosper means first and foremost supporting our customers and clients when and how they need us most. Our strategy to grow, focus and change has helped us to do more and better for our customers. We are transforming our organization to be a truly helpful, personalized and ever-present financial partner, enabling far greater resilience and empowerment, now more important than ever. As we enter the final stretch of our five-year strategy, it is important to reflect on what has been achieved for the benefit of all those we serve.
We've returned our group to growth, improved our cost and capital efficiency, and delivered the biggest digital transformation in U.K. financial services. We've outperformed the targets we set, diversified revenue streams and gained key areas of market share. Our performance in 2025 is propelling us forward with real momentum and renewed determination to protect strength and resilience for our customers, communities and shareholders. Thank you to all our colleagues who are at the heart of our transformation and forefront of delivery. In 2025, and despite continued low U.K. growth, the group increased its underlying lending by over GBP 22 billion to over GBP 481 billion. Last year also saw almost GBP 14 billion growth in customer deposits to nearly GBP 500 billion.
Since the start of our strategy, other operating income has grown by 9% or more each year, and we've realized GBP 1.4 billion of additional revenues from strategic initiatives to date and are upgrading our 2026 target to around GBP 2 billion. Our strategic execution is enabling major investments in our people, data and technology and ensuring that over the past three years, our capital distributions have exceeded GBP 11 billion. Turning to our results for the first quarter of this year, released last month. We demonstrated sustained strength with net income at GBP 4.8 billion, up 9% year-on-year. Cost discipline remains a key focus and total operating costs of GBP 2.5 billion are down 3% year-on-year, reflecting higher cost savings, partly offset by business growth costs and inflationary pressures.
Statutory profit after tax was GBP 1.6 billion in Q1. Our robust financial performance has delivered capital generation of 41 basis points year-to-date and a strong CET1 capital ratio of 13.4%. As Robin said, there was no further provision for motor finance following the announcement of the final FCA redress scheme. Our priority remains that customers receive fair, appropriate and timely redress. We remain confident in our 2026 guidance and are well positioned as we look further ahead. I look forward to sharing an update on our new strategy this July alongside our half-year results, outlining our investment plans and growth objectives going forward. Today, no other U.K. financial services provider offers greater choice, convenience and reach for our customers, whether online or in person.
We are supporting people in the ways they choose to bank with one of the largest branch networks, 30,000 PayPoint locations, over 200 banking hubs and access to 11,000 post offices. From 2025, customers across our brands were able to access their accounts, products and services at any of our Lloyds, Halifax and Bank of Scotland branches. Together with our apps, our digital front door, we're giving customers the control and convenience which they want and need, 24 hours a day, seven days a week. With over 23 million digitally active customers logging on over 7 billion times every year, a 50% increase in just three years, Lloyds is the U.K.'s largest fintech. Recognized by Euromoney as one of the best digital banks in the world.
We've modernized our complex technology estate, welcomed 9,000 data specialists, and are using 800 AI models to support customers' insight, prevent fraud, and streamline their experience. Having delivered over 60 GenAI use cases, we're now proud to be rolling out one of the first AI assistants in financial services at scale. Around half a million Bank of Scotland customers already have access, as will all our app customers in the coming months. While at Scottish Widows, we've started rolling out a new AI agent in line with the FCA's new reforms on targeted support. These innovations will provide personalized guidance and insight in the palm of your hand. By combining the deep expertise of our colleagues with the responsible use of AI and new technologies, we can do more to empower customers in the next five years than was possible in the past 50.
Which is why, as you heard from Robin, we are equipping every one of our colleagues with AI training regardless of role or experience. We've also brought expert partners back in-house with Lloyds Technology Centre in Hyderabad and welcomed over 70% of colleagues into transformed collaborative spaces across the U.K. That will be 95% of colleagues by next year, including a GBP 200 million investment into our Port Hamilton site right here in Edinburgh, creating a state-of-the-art hub for finance and technology for over 9,000 colleagues. Our teams are being supported to deliver brilliant new digital solutions, bringing more of our group to each customer in truly helpful, connected ways. For example, Lloyds Premier, Ready-Made Investments, and Ready-Made Pensions are supporting those who want to do more with their money digitally at different ages and stages of life.
40% of customers for Ready-Made Investments are under the age of 35, while 40% of accounts for Ready-Made Pensions have been opened by those who are self-employed. These tools are helping people who have historically been underserved. As the U.K.'s second-largest pensions provider, trusted to look after GBP 129 billion on behalf of our workplace pensions customers, we're proud to be increasing access and reach, as well as building out Lloyds Wealth, the U.K.'s most distinctive wealth and advice platform. At Lloyds, we're enabling the critical digital, financial, and physical infrastructure which is helping Britain prosper. At the start of this year, we completed the U.K.'s first public blockchain transaction of digital assets using tokenized deposits, transforming the speed, ease, personalization, and accuracy with which customers and clients can do business.
We are also, as Robin said, delivering billions to support energy, new technologies, healthcare, and housing. We cannot build up Britain without a solid foundation on which to build. We need good homes in the right places to support strong communities and a skilled workforce. This is a priority right across the group. Lloyds' pioneering MADE Partnership with Homes England and Barratt Redrow created a master developer to deliver tens of thousands of new homes. The first major projects are now underway in Godley Green and Handforth Garden Village in Manchester. Since 2018, we've supported over GBP 22 billion in financing for social housing and have also delivered over 80% of our GBP 500 million retrofit commitment to help housing associations make homes warmer, energy efficient, more economical for residents.
As a leading mortgage lender, we have supported over 1 million first-time buyers since 2011, lending GBP 17 billion last year alone. We're enabling many first-time buyers to borrow more and realize their homeownership dreams sooner with an additional GBP 5 billion available through our First Time Buyer Boost. Just last month, we delivered a fully digital home buying journey, making things faster and more transparent in partnership with the U.K.'s leading estate agent and conveyancer. The U.K. needs more housing for buyers, renters, and the growing waiting list of people in temporary accommodation. Collaboration across sectors is essential. Having convened the Social Housing Initiative, we've helped pioneer the finance and delivery of homes on small brownfield sites at the heart of our cities with government-backed pilots underway in Bristol, Sheffield, and Lewisham.
A strong economy needs strong banks. Lloyds is instrumental in creating the right environment for investment and growth, essential in creating jobs, raising living standards, and enabling public services. At a time of heightened uncertainty, we have particular focus and support for those who are least financially secure. No other U.K. financial organization has the same depth and breadth of understanding when it comes to U.K. customers' real-time consideration and needs. We want to help households and businesses navigate the pressures they face. We're committed to increasing financial empowerment and fueling this country's forward momentum, advancing the U.K.'s world-class universities, technology ecosystem, energy infrastructure, high-growth industries, and entrepreneurs. Our customers remain resilient, ambitious, and outward-looking despite areas of challenge and current uncertainty. We have a responsibility to them, our communities, and shareholders to deliver a stronger, more prosperous future.
Thank you to all my colleagues for helping us do just that. May I now hand over to Amanda Mackenzie, Chair of our Responsible Business Committee.
Thank you, Charlie, thank you, Robin, and good morning, everyone. As we've been reminded today, our roots here in Scotland run deep, and they form part of a wider heritage that spans centuries of support across the U.K. In times of great uncertainty, we remain steadfast in our commitment to helping Britain prosper, 'cause that is how we build a resilient and profitable business that delivers real impact across the country for generations to come. This constancy is one of our great strengths. We are there to support people and businesses while evolving with the world around us, and I'm immensely proud of what the group has achieved over the past year, and I'm pleased to bring this to life for you this morning. Let me start with the support for housing.
As the U.K.'s largest mortgage provider and a longstanding champion of our U.K. house building, our success is intertwined with the sector. We know that safe, quality, and affordable homes sit at the heart of economic prosperity and strong communities. As Charlie notes, we have continued to invest in the U.K. social housing as the largest lender to the sector, delivering over GBP 3 billion of new finance in 2025. On this stage last year, I shared Lloyd's commitment to supporting small and medium-sized housing providers and charities with GBP 50 million of new lending. One example is a loan of GBP 10 million to Bournemouth Churches Housing Association to enable the delivery of up to 300 new affordable homes by 2029.
At a time when Bournemouth, Christchurch, and Poole face some of the highest rates of homelessness in this country, this investment can improve access to finance, increase housing provision for these most in need. Last month, we were thrilled to announce the extension of our charity partnership with Crisis. Since 2023, our colleagues have raised over GBP 5 million for Crisis, going above and beyond with their fundraising. In some cases, as far as trekking in the Sahara. Of course, core funding is always vital for a charity. Our partnership is seeing the launch of innovative new solutions to help end homelessness and rebuild lives. For instance, we funded the setup of Good Place Lettings, a new socially responsible lettings agency and property management company launched between Crisis and Homes for Good here in Scotland.
The agency has since helped 40 households settle into safe, stable homes. In April, we unlocked GBP 6.9 million of unclaimed funds for Crisis to kickstart buying of their own homes in London and Newcastle. Turning to financial empowerment, as the U.K.'s biggest digital bank, we know that when people feel empowered, they do more than manage their finances, they invest in their futures, and this matters to the U.K. economy. We've heard from Charlie and Robin this morning how digital innovation and seamless in-app experiences are giving customers more agency over their finances. This week, we published research showing that accelerating the digital transformation of financial services could add up to GBP 100 billion to the U.K. economy over the next 10 years. That's around GBP 3,500 more per household just through better money management and helping people invest for their futures.
To realize this opportunity, people need to have the tools and the confidence to thrive in a digital-first economy. We've helped over 1 million people build their digital skills, taking greater control of their finances through our Lloyds Bank Academy digital helpline and financial education programs. A real grassroots example this last year, we trained 650 residents of three housing associations across the Midlands and the South, giving them the essentials to get online. These residents can now stay connected, manage their money, and apply for jobs which they simply couldn't do before. Lloyds has a long history of investing in communities, and as one of the U.K.'s leading providers of finance for major infrastructure projects, we've continued to drive long-term, place-based investment this year. In the Northwest, we're supporting Haweswater Aqueduct Resilience Programme, a landmark project to modernize the region's water supply.
When finished, six new tunnels will deliver 570 million liters of water every day. That's clean drinking water for around 1 in 20 U.K. households, and that's just one project we're supporting. We've committed GBP 100 million through Lloyds Bank and Scottish Widows as part of a wider GBP 3 billion investment. The project will create up to 1,200 jobs for local people in Cumbria, Lancashire, and Greater Manchester. Beyond major infrastructure projects, our GBP 1 billion regional impact fund is backing people and businesses powering local growth across the U.K., quietly getting on with energizing local economies. As the first mainstream lender to back U.K. community development finance institutions, we know how they can boost local economies, and Blackpool's a brilliant example of that ambition in action.
In October, we announced our support for business funding Blackpool, helping the Fylde coast to become a vibrant place to live, work, and grow a thriving business. Alongside this work, the group's four charitable foundations have continued to support grassroots charities all over the U.K. Since 1985, we've donated over GBP 800 million, including more than GBP 35 million last year. An example right on our doorstep was a GBP 90,000 grant to Young Carers Edinburgh. With this Bank of Scotland Foundation funding, the charity can now provide more services to children caring for their families, helping them attend school more regularly, which means that every child can be a child first. All these examples show how our commercial strength and presence in communities are driving prosperity across the U.K.
Moving to transition, that prosperity is inseparable from resilience, recent global events demonstrate the need for a strong, diverse energy system for the U.K. We lead in financing U.K. renewables, in March we completed a GBP 62 million loan to the Benbrack onshore wind farm in Dumfries. Once operational, Benbrack is expected to generate enough electricity to power the equivalent of 60,000 Scottish homes, bolstering domestic energy security. A clear example of how investing in transition supports commercial growth while strengthening our national resilience to global shocks. We've continued to make strong progress this year from supporting British farmers to funding clean infrastructure. Progress reflected in our AAA MSCI rating, placing us in the top 11% of banks worldwide. To inclusion, we are proud of our continued progress towards our 2030 inclusion ambitions.
Our colleagues reflect the customers and communities we serve, and we provide opportunities for people regardless of their backgrounds. In 2025, our youth outreach program supported over 100,000 young people across schools, colleges, and universities, building essential skills and strengthening the group's future talent pipeline. As I close, on behalf of the Responsible Business Committee, I would like to thank Robin and Charlie and all our group colleagues for their unswerving and wholehearted ambition and dedication this year. They are guided by a clear, strong purpose that together we can shape an economy where customers and communities thrive. We continue 2026 with commitment and confidence and constancy, Helping Britain Prosper. Thank you very much.
Thank you, Amanda, for those remarks. I'll now say a few words about the resolutions we'll be voting on today before giving shareholders the opportunity to ask questions. Voting will be open before shareholder questions and will remain open for the duration of shareholder questions. I'll give you a reminder to vote towards the end of shareholder questions and again before voting closes. Unless there are any objections, I will now take the notice of Annual General Meeting as read. Thank you. Resolutions 1- 20 are ordinary resolutions requiring a simple majority of more than 50% of the total votes cast to be approved. Resolutions 21- 26 are special resolutions, and to be approved require at least three-quarters of the votes cast to be in their favor.
All the resolutions will be decided by a poll, which means that each shareholder present in person, by proxy, or corporate representative has one vote for every share held. Turning to the voting handsets, can I first check that everyone who would like a handset has one? Please raise your hand if you need one. Many of you will have used the handset before, and the slide behind me explains how to use it for voting. Once I declare voting open, the list of resolutions will appear on your device. While you have the choice to withhold your vote, this is not a vote in law and so does not count either for or against a resolution. If you wish to vote on all resolutions in accordance with the board's recommendations, there is an option to do this which is shown at the top of the list of resolutions.
To change your vote, choose the resolution and simply vote again, and your original instruction will be replaced. To cancel a vote, select the resolution and press the X button. The vote will be removed and not counted. If you need help, please raise your hand and one of our stewards will help you. I now declare the voting open, and I'll now move to the part of the meeting where shareholders or their appointed proxies ask questions. Out of respect for all shareholders, I ask that you ensure that your question relates to the items of business before the meeting. I'd also like please to encourage you to keep your questions short and avoid delivering long speeches. If you have more than one question, please ask all your questions at the same time.
We take customer complaints very seriously. It's important that they are dealt with properly. Customer complaints are not something we can resolve in the room at the AGM. It would be inappropriate to do so. There is a customer service desk outside in the reception hall where my colleagues are available to help you with any specific queries on customer matters. Please raise any individual customer issues or inquiries with colleagues at the customer service desk outside this hall after the meeting. To help proceedings, shareholders who want to pose a question were asked to register at the question registration desk before coming into the auditorium. I'm aware that many of you have already done just that. Thank you for doing that. For those of you who haven't, please raise your hand now if you want to register a question and a steward will assist you.
A steward will take you to one of the two question points when it is your turn to ask a question. If you're attending on behalf of someone else, please state your name as well as the name of the shareholder you represent. Our first question comes from Charlie Guy-Knapp.
Hello, members of the board. My name is Charlie, I'm asking this question on behalf of ShareAction. The impacts of global heating continue to intensify with more frequent extreme weather events and heat waves causing untold suffering across the world and damaging economies. Despite these risks, over the last two years, we have seen some of the world's largest banks backtrack on climate. I first wanted to thank leadership for your clear statements in this year's annual reporting that Lloyds Banking Group does not intend to backtrack on its climate commitments and seeks to continue progressing in energy transition. Your courage in pushing back against calls for climate inaction is greatly appreciated and stands in contrast to peers that have retreated from their commitments. NatWest, which recently garnered significant shareholder dissent at its annual general meeting for doing so.
Lloyds Banking Group stated in its latest sustainability report that the cost of inaction is too high, with rising building operating expenses, escalating transition related economic costs from delayed transition, increasing impacts from extreme weather and the degradation of nature. Against this backdrop, there is one area where we believe the bank could improve on. The U.K. government has committed to a clean power system by 2030, with at least 95% of electricity generation coming from low carbon sources. While Lloyds' ratio of clean energy to fossil fuel financing grew an average of 12% between 2021 and 2024, the bank still financed more fossil fuels than it did renewables at the end of this period.
On its current trajectory, it would reach a ratio of roughly 1.8 renewables to 1 fossil fuel by 2030, which is short of the approximately 19 to 1 that would be implied by the government's target. In light of this, my question today is, how is Lloyds actively aligning its financing strategy with the U.K. government's clean power objectives, and will it consider raising the ambition of its sustainable finance targets? Thank you.
Thank you, Charlie. We appreciate our interaction with ShareAction, which has always been positive. We believe that the government's clean power initiative is a real opportunity for us. We have made a number of commitments to sustainable finance. We've invested over GBP 70 billion in that, and we intend to change that so that it becomes even more demanding going forward, considering we have now just about reached our objective already. On the ratio, I think that's something that we are looking at carefully. There are different ways of measuring it, as you will know, and that's something we will continue to monitor as we go forward. Thank you very much.
Good morning. I'm Rosalind Leech, here on behalf of ShareAction as well. It's a privilege to be attending the AGM in person, exercising our rights as a Lloyds shareholder. An increasing number of companies have recently moved to online only AGMs. Virtual only formats can create distance between the board and shareholders, and in practice can restrict meaningful engagement. Shareholders' questions can be filtered, time-limited, or not answered substantively. Should shareholders be concerned that Lloyds may move to online-only AGM format in the future? Will Lloyds commit to maintaining hybrid AGMs rather than online only as part of strong corporate governance practices? Thank you very much.
Thanks, Rosalind. We enjoy our interactions with shareholders at these events, and we recognize the benefits of that. We have no current intention to change that. As you are aware, there are changes in legislation around, and we will keep an eye on that to make sure that we are doing the right thing for everybody involved. Thank you.
I'm William James. The fraud at the HBOS Reading branch took place in the early 2000s. It was pointed out in the House of Lords in March of this year that the investigation had still not been resolved. I have been told that the way that your predecessors handled the cover-up was by appointing the most incompetent people they could find to work on the investigation. Was Rachel Reeves a member of the investigation team?
Thank you. First of all, again, I would reiterate our apologies to everyone affected by the HBOS fraud. The review, as you say, is an independent review. The timing of that is very much down to the reviewers, Dame Linda Dobbs, who is a, an eminent member of the legal establishment. In terms of teams and things like that, we obviously don't disclose individuals. Thank you.
Thank you.
Do we have another question, I think, a Mr. Mortner?
Roger. Thanks. Now?
Yes.
Good morning. In addressing the board, my name is Roger Mortner from Hampton Court, East Molesey, near Hampton Court Palace. In addressing the board, it's the old chestnut from where you are sitting, I would like to know, please, why is it the company are closing so many, I say small branches, but it really should be all branches. That's across the Lloyds, Halifax, and Bank of Scotland stable.
Thank you, Mr. Mortner, particularly thank you for coming so far to be with us today. We greatly appreciate it. As you say, this is a long-standing question, it reflects very much the changing nature of banking today, where all our services are available online. We are aware every time that we close a branch of the implications of that, we do it very carefully. There are always independent assessments of, particularly around access to cash, which we make sure we take fully into account when we take these decisions. We have a wide range of different forms of access to our service beyond the app. We have a number of now over 200 banking hubs which we are represented in.
We have 11,000 post office outlets, with whom we contract to service our clients, as well as PayPoint in individual corner stores. We also have a very efficient and friendly, I hope, telephony service so that people who want to talk to people can actually ring somebody and talk to them. We are very careful about what we do. We recognize the inconvenience this causes, but it is a reflection of the different way in which people want to do their banking today. Thank you, Mr. Mortner, and thank you again for making the trouble to come so far today. Yes, please.
So-called housing market at the worst for some 11 years, so the so-called experts say. They also say it is now cheaper to rent than to buy. Why are the Lloyds Banking Group emphasizing mortgages so strongly? Why are you emphasizing taking out a mortgage rather than renting at this time?
Thank you. I think the decision whether to rent or buy is very much one for individuals to make depending on their own circumstances, their own wishes, and I think our job is to make mortgages available, particularly to first-time buyers, which we do in enormous numbers, in a way that works for them, enables them to afford it. We are very careful about our affordability ratios to make sure that people only take out mortgages when they are able to do so. Mainly I think the answer is this is a question for individuals to make, and our job is to provide the mortgages when it's the right thing for them.
Thank you, Sir Robin, and the board.
Thank you, Mr. Mortner.
Sir Robin and the board, good morning. I am Michael Baird and have been attending these shareholder meetings for a number of years. I have seen a backward approach to banking having lived in Bonar Bridge since 1993 when there were many bank branches all working five days per week. Last year, I reported that the last bank standing in Sutherland closed in February 2025, leaving no bank or ATM. Now in 2026, we have seen the last Bank of Scotland branches closed in Tain, Dingwall, Nairn, and Gairloch. When I first holidayed in Ross-shire and Sutherland, there were 8 banks and building societies in Tain alone. Let me now give you an example how difficult it is to get hold of cash. I wanted to get two Bishop Briggs tickets for their 30th year concert.
These were available from Forbes Jewellers Tain, cash only. I went to seek cash from the Co-op ATM. Surprise, surprise, out of cash. ATM and the last bank gone from Tain, I headed to the ATM at Tesco. Once again, surprise, out of cash. I went into the Tesco, bought a product, and asked for GBP 20 cash back. The assistant's face dropped. He could only give me GBP 20 in coins. I returned to the jewelers and apologized for paying by so much coinage. Tain has not been considered for a banking hub. Why not? We will shortly have no banking north of Inverness. Comments, please.
Thank you, Mr. Baird, welcome back to our AGM. We always welcome your continued prompting on behalf of Bonar Bridge. As you can imagine, I'm well briefed in answering that question, but I hadn't actually heard about the GBP 20 in cash, so I'm sorry about that particular experience. There is of course, we Bonar Bridge does have a post office and we have, as I described to Mr. Mortner, that we have a contractual arrangement with the post office to supply cash to our customers. We also have community bankers who visit Golspie, Bonar Bridge, Dornoch, and Helmsdale, I'm sure that our colleagues will be able to give you their contact details so that in future you will be able to talk to them. I'm really sorry to hear about your difficulty in buying those tickets which sound. Was it a good night?
It was an excellent night.
Excellent.
Full house in the Dornoch Center.
Excellent. Well, I'm glad you were able in the end, albeit inconveniently, to buy those tickets.
Thank you very much for that.
Thank you, Mr. Baird. Nice to see you again.
Morning, Chairman. My name is Alan Busson. I'm a trustee of a charity that's works on the Outer Hebrides. I can almost trump Mr. Baird actually.
Okay
with the bank closure situation. Our business is in effect on the islands and it was interesting to see that our bank website is all about Helping Britain Prosper, being more sustainable and inclusive and supporting the needs of communities. Geographically, our branch at Balivanich, which is on Benbecula, serves the islands of Berneray, North Uist, Grimsay, Claddock, Baleshare, Benbecula, South Uist, and Eriskay. A chain of islands with about 4,000 inhabitants stretching some 60mi with a considerable amount of single-track roads. I understand that a petition containing in excess of 1,200 signatures, that's over a quarter of the population, was submitted to you by the people of these islands opposing the bank's closure. Bank of Scotland have kindly stated that our branch will be moved to Inverness.
The Uist to Inverness involves a ferry journey. If you actually happen to travel to and from the islands, a ferry journey can be quite good fun. You can be subject to cancellations. In effect, including the ferry journey, it can take 6 hours return road trip, some 254mi , and is impossible to complete in a day. The cost of this journey will cost way in excess of GBP 100. We are very much a cash-based business. Your LINK assessment, which in effect is the supposed independent assessment carried out every time a bank has closed, says that we should use the post office.
The post office opening times are very limited, and sometimes the post office refuses to take the cash because they're up to their financial capacity. Our bank has the security infrastructure, and I mean our bank, Bank of Scotland at Balivanich, it has a security infrastructure to deal with large deposits of cash. Some post offices do not. Link, which does your closure assessments is in effect a company registered by a guarantee, and is owned by various high street banks and financial institutions, including, I suppose, Lloyds Banking Group. This is hardly an independent assessment. The isles that I refer to and that our bank services are probably some of the most fragile island communities in the U.K. hanging on to the western Atlantic, and we are closing our branch there on the 1st of July 2026.
Are we helping the islands prosper? I doubt it. Do our communities feel supported? No. What is the bank's defense for taking this action? I mean, is it really just the usual sort of cost effectiveness and all that sort of thing? We have, I noticed from the LINK assessment, 264 people who visit the branch every month. Now, that's again, quite a percentage of the population. I'm sorry to go on, but I just think this is the thin edge of the wedge for a very fragile community.
Thank you. Thank you, Mr. Busson, and thank you for the work that your charity does in the area. As I said before, we do take careful consideration before we take these actions. I think LINK is an independent operation. It works very closely with the FCA that liaises with it as we go forward on these programs. I'm sorry to hear about the issues you've encountered with the post office, and we will take that away and talk to the post office and see what we can do about that and try and find out more about what's going behind that. I think there is also a PayPoint in Benbecula where people can also access cash. The more I found out about Benbecula, the more beautiful it sounds. We will do what we can to make sure that those 4,000 people continue to be able to access cash.
Thank you.
Thank you, Mr. Busson.
Still disappointed.
I understand. I understand.
Hello, Robin. It's me again. Promise me this, that you will tell the truth when you answer.
I will tell the truth.
You promise?
I will tell the truth, Mr. Brotherston.
On your children's lives?
I will tell the truth, Mr. Brotherston.
Right. I'm here representing Lloyds Shareholders Action Group, which we've had to resurrect because of the criminality, fraud, cover-ups that are going on. This is chaired by Professor Nigel Harper, you know, the man who we elected to your job in 2021 after there was a vote of no confidence in you in May 2021. You refused to step down. Professor Harper asks this question: What is happening with the Dobbs review given Dame Linda has now resigned? We shareholders demand to see a copy of this unredacted as we have paid for it.
Thank you, Mr. Brotherston. First of all, I'm not aware that Dame Linda Dobbs has resigned.
Well, that's the rumors.
Okay. Well, the those rumors have not reached me.
You will copy in Professor Harper to having an unredacted copy of the report of the review as soon as it is published.
We will publish the findings of the review in full. I'm not saying that it will be completely unredacted because there could be elements in there, which have legal privilege, confidentiality issues, which we simply are not able to publish. We have committed to publishing the findings in full, and we will make sure that Professor Harper gets a copy.
How much has this cost to- date?
I'm not aware of the full cost, but it has been going on, as you know, for a long time. It is a review that the board commissioned some time ago. It is not something that is under the board's control because otherwise it wouldn't be independent. Costs, et cetera, are very much things, that should be addressed to Dame Linda Dobbs.
Next point. How many qualified bankers are on the executive board?
As you can see from the individuals represented on the board, most have come from a financial services background. Many are very esteemed, ex-bankers, chief executives. I am absolutely confident we have a lot of really genuine banking expertise on this board.
Right. The next point was your Form 20-F has very many vagaries in it that I have a copy of it. We've had our AI do a very deep dive onto it, and there are very, very questionable points buried very deep within this. Is this meant to deceive people?
There is absolutely no intention, obviously, to deceive people. Those documents have been carefully scrutinized, both by our own team and by our auditors. We go through substantive processes to make sure that they are fair representations.
I have evidence of fraud committed by Lloyds Banking Group, Black Horse Finance testified to and approved. We have served affidavits on yourself, as you know, and others of the board. Liens have also been served. None of these criminal matters have been repudiated, thus they stand in law. Again, I have evidence here that I will make sure you have these copies of where we have fake solicitors writing. I wrote back to these people in good faith. That's fraud. Committed fraud. We pulled up Blackwell & Lupton about the matter. They obviously emplaced you to continue the cover-up. We want to know what you're doing about these crimes and why the lies to MPs. That is strictly contempt of Parliament. When you lie about fake solicitors to an MP, there's something clearly rotten in Lloyds Banking Group.
Thank you, Mr. Brotherston. If you are dissatisfied with anything, you of course have the opportunity to apply to the courts.
Yes, sir, but you make sure that I'm penniless because you won't remediate HBOS Reading victims. They're still living in poverty. The people have been to jail, they're out of jail, and yet the people they defrauded are still penniless because you will not settle it. You'd rather throw shareholders billions at your shysters. I mean, it's ridiculous. You've spent, what, GBP 20 billion, GBP 30 billion, something like that, obstructing justice when it would only have cost GBP 15 billion to, or circa GBP 15 billion, to pay us all.
Uh, Mr-
We are victims of deliberate criminal acts lied about by Horta-Osório. I mean, Horta-Osório found a lie to the Treasury Select Committee about the Sechiari fake, Sechiari, Clark, and Mitchell being some collection agency from Hull. Well, there's a headed note paper. It shows they're working out the Black Horse building in Cardiff. It turns out, as Lord Tyrie then said, they found the paper, the letterhead, the Sechiari, Clark, and Mitchell, to be nothing more than a letterhead for committing fraud purposes. They wrote to me. I wrote back to them in good faith. That's fraud. When am I getting remediated because your two guys last year said you will never pay me?
So, uh, just to, again-
When am I getting paid?
We have.
Millions
under the Foskett Review.
When are you going to pay me?
Sorry. Excuse me. Can I answer, please? The Foskett Review has settled with virtually all now the victims of HBOS Reading. We have got on and remediated that, and that, as I say, is virtually complete now.
There are notable exceptions to that. Virtually everybody who took part in Spank the Banker has been deliberately obstructed and having a seriously hard time because of these criminalities. I mean, are you trying to have people killed or wiped out? I mean, it's just disgusting what you're doing. We have one victim in Brighton, a Ms. Mottram, who can't be here today because of her health. She suffers from extreme Crohn's disease. What are you doing? You're driving her into the ground when all you needed to do was give her GBP 100 million for the business you stole. She would have gone away quite happy, like myself. Pay me. You've got You robbed me quickly enough. Remediate me. Are you too embarrassed? Will I have to take your house, which has a lien served on it?
Thank you.
That was, yeah, that was the question.
Thank you, Mr. Brotherston.
When will I have to take your house?
Thank you, Mr. Brotherston. Next question, please.
Thank you, Sir Robin. This is a question asked on behalf of Scott McFarlane. Is Charlie genuine, as in demonstrably untrue, that the people employed by LTC are those whose skills do not exist in the U.K.? Two specific examples are group telephony team, front office telephony platform, and CFA workforce planning team replaced by LTC. In the case of group telephony, there was a level 4 risk raised to Ron van Kemenade on the risk of losing skills.
Thank you, Mr. McFarlane, for the question. I think it's really important to say that, as Charlie said, we are having to change the skill base of our organization and technology skills are in short supply across the globe. We have recruited over 5,000 people with those skills in the U.K. in addition to the people we've recruited in LTC. At the moment, we have plenty of vacancies still open looking for people with those sort of skills. The operations that you mention that have been offshored have been offshored for many years now and do a really good job. We are comfortable that the skills that we have are well protected and will continue to the future. Thank you, Mr. McFarlane.
Good morning. My name is Lynn McMillan, and I'm an ordinary shareholder. I note that Mr. Nunn's remuneration package this year is probably going to be in excess of about GBP 9 million, perhaps even quite a lot more. This is around 50x what the office of the Prime Minister gets paid. Whatever one might think of the present incumbent or even his recent predecessors, one has to accept that the office of the Prime Minister affects every single man, woman, and child in this country. What the Prime Minister does is of huge importance to everybody in this country. You have said yourselves this morning that you have about 28 million customers in the country, so you're not affecting every single person in this country with your actions.
I really can't understand why you think that, the chief executive of Lloyds Banking Group is worth 50x , at least 50x more than, the office of the Prime Minister. I also think it's obscene that the chief executive's remuneration package is so much in excess of what average Lloyds Group staff are paid, hundreds of times what Lloyds staff are paid. I don't know about other people in the audience here, but I think I would have great difficulty in spending GBP 9 million a year even if I tried pretty hard.
I was recently in a pharmacy and the lady in front of me, who was dressed in NHS uniform, was inquiring about buying an over-the-counter medication and she was told it was about GBP 9.50 and her face fell and she said, "I can't afford that this week," and walked out. I don't think, with all due respect, that people who are paid in excess of GBP 9 million have a clue what it's like for ordinary people in this country and I think you're paying lip service to it when you say that you understand how difficult it is for people in these economic times.
Please don't reply by saying that that's what the market demands because it's an upward spiral and the more you pay, the more someone else will pay, some other financial institution will pay, and it'll just keep on going up and up and up into the stratosphere. Ordinary people like us, I'm a trustee of a pension fund. I see people having to manage on less than GBP 20,000 a year and having to cope, and I do think it's obscene what you're being paid and what you're taking. Thank you.
Thank you, Ms. McMillan. I would like to say that Charlie is an extremely highly regarded Chief Executive. He has driven enormous change across this organization which would simply not have been possible without his personal skills and experience. We are very lucky as an organization to have Charlie as our Chief Executive, and he is an extremely humble individual. As you say, the answer to that question is we have to pay the market rate. If we don't pay the market rate, we don't get the right people and if we don't get the right people, not only will our shareholders suffer, but the whole of our impact in the U.K. will be undermined. I have no shame whatsoever about the amount that we pay to our people.
We have an extremely, well, an outstanding team, and that we're very lucky to have them. I completely understand where you're coming from in your question.
Thank you, Sir Robin. This is a question on behalf of Lindsay Butler. Has outsourcing to Diligenta genuinely improved customer service, and can you provide specific metrics rather than just assurances?
Thank you. It's a very appropriate question. As I've said before in this forum, our service to people in our pension transfer business took a turn for the worse a few years ago. We have addressed this very diligently. The management team in Scottish Widows, under the leadership of its chief executive, has really focused attention on this. We know that we weren't good enough, and we apologize to those who were affected by that. In terms of how we can underpin the recovery of that service, I think probably the best measure is to say that in the second half of last year, the level of our complaints per 1,000 customer was lower than our peer group. Our Trustpilot score was in a very good place at around 4.6.
Once again, I apologize for what happened in the past. It was recognized and addressed, but we will continue to keep a focus on it and on the service that is provided for our customers. Thank you.
Good afternoon, Sir Robin, and ladies and gentlemen of the Board. My name is Peter Shepherd. I'm a shareholder. I'm apologizing for not giving notice of this question before the meeting, but it only arose from something the King said in his speech yesterday. It was then echoed by members of the Government, all saying that they're going to or they're looking to increase taxation on major businesses in the U.K. Lloyds Banking Group contributes hugely in form of taxation to this country. We don't tell the public the full story. We announce what corporation tax we pay, we don't say how much we pay in irrecoverable VAT. We don't say how much we pay in petrol revenue tax. I could go on. There are numerous taxes that the Group pays.
Have the Board given any consideration to letting the public know just how much tax we contribute to this country? What I would want to just observe is all your competitors are the same. They do not want to say how much taxation they're paying, except for the corporation tax. Have the Board considered being the first to actually tell everybody just how much we are contributing to this country?
Thank you, Mr. Shepherd. Please don't feel you have to apologize for not giving notice of a perfectly interesting and sensible question. Thank you for that. We are indeed one of the biggest taxpayers in the U.K. The U.K.'s tax on banks is higher than we think just about anywhere else in the world. As you say, that's corporate tax and is only part of the issue. We do actually, I think, William, publish a report on the tax that we pay, including a wide range of different taxes. William, you might just want to give Mr. Shepherd a sense of that. Maybe the fact that you don't know about this suggests that we need to publish it a bit more.
Thank you, Robin. We do, as you say, publish an annual guide to our tax contributions to the U.K. The number in a gross sense, which includes things like employee taxes and such like in addition to corporate income tax, is GBP 2.8 billion. Then we pay within that GBP 1.9 billion of corporate tax, corporate income tax. Those details are disclosed in that report. There are, I suppose, incidental taxes that are paid by our employees and others, which one could add to that total. Actually, it's the GBP 2.8 billion in total tax that we pay, and then the GBP 1.9 billion of corporate income tax within that that we focus on.
Thank you. If you, again, if you ask one of our colleagues, they will allow you to get access to that report.
Thank you.
I think you are right. We pay more tax than that. It's quite difficult to define what we should, if you like, I don't like to say claim credit for, but what we should include in that number. Thank you.
Gerald Cox is my name. I'm from Dublin, Ireland. I just have a number of questions to ask you. Given that the bank is in the final year of its 2022, 2026 strategic plan, what is the projected net interest income for 2026 and thereafter? My next question is, what is the anticipated return on tangible equity going forward? The next question is, final question is, you mentioned there the industry-wide redress scheme for motor finance compensation claim. I'd like to know, you increased the level of compensation by GBP 800 million for the motor finance compensation scheme. I'd like to know, what are the key factors driving the increased estimate for motor finance commission redress scheme? Was this a higher level due to a higher number of eligible claims than previously anticipated for the motor redress scheme? Thank you, Chairman.
Thank you, Mr. Cox. So in terms of We have said that our expectations for 2026 for net interest income are of above GBP 14.9 billion and for return on tangible equity of 16%. On the motor finance scheme, there have been very significant developments in relation to the motor finance scheme this year. First of all, there was the Supreme Court decision, and then there was the publication of the FCA's redress scheme. Both of those gave much greater clarity on what we needed to do to remediate for that issue. That's the reason why the provision increased by GBP 800 million during the course of this year.
Okay. Thank you.
Thank you, and thank you for coming from Dublin to join us today. I think we're now reaching the end of the question- and- answer session. Please ensure you vote now if you wish to do so, as I'll be closing the voting when the question- and- answer session ends. Does anyone else have any questions? There's a gentleman down here. Any other questions? Okay. We've come to the end of the question-a nd- answer session, and I'm about to close the voting. Please register any final votes now. I now declare the vote closed, and that concludes the voting at the meeting. Thank you. The proxy votes already received in respect of each resolution are now showing on the screen behind me, and the provisional result is that all the resolutions have been carried.
I would like to thank shareholders for their continued support. The poll count will be conducted by our registrars, Equiniti, who will also act as poll scrutineers. The final results of the poll will be announced to the London Stock Exchange as soon as reasonable practical following the conclusion of this meeting and will also appear on our website. That concludes the business of the annual general meeting. Please return your voting handset to one of the collection points outside this room. Thank you for attending the meeting today and for your support, which we greatly value. I wish you all a safe journey home. Thank you very much for coming.