Lloyds Banking Group slashed £13.5bn from its real estate exposure last year, according to its full year results released today.
The part-nationalised lender said it had reduced its property loan portfolio from £78.3bn to £64.8bn – its largest annual reduction since it began the process of cutting its property exposure in 2008.
It employed a number of methods, including the sale of £4.8bn of property loans and assets, to achieve this figure.
The bank also revealed it had managed to cut its losses on bad property loans from £2.4bn to £1.3bn.
The bank’s Business Support Unit – set up to restructure and dispose of loans – fell from £26.2bn at the end of 2010 to £21.3bn at the end of 2011.
Of the balance of loans, close to three-quarters – some £15.2bn – are impaired, and impairment provisions of £5.6bn have been taken against these loans in the past few years.
The results follow those of fellow part-nationalised bank, Royal Bank of Scotland, which yesterday revealed it had shrunk its exposure to real estate by 14% last year, taking it to a total of £74.8bn.
This includes £34.3bn in its “non-core” division, which booked £3.4bn of losses in 2011.
Bridget.oconnell@estatesgazette.com
