# Lloyds sees annual profits jump 12% in spite of motor finance hit

By Russ Mould — 2026-01-29

Russ Mould, investment director at AJ Bell, said: “Banks should do well when interest rates are rising so it is noteworthy that Lloyds achieved double-digit profit growth for 2025 despite rates moving lower through the course of the year.

“The performance is a vindication of the strategy adopted by CEO Charlie Nunn in 2022 to diversify the business and make it less reliant on the interest rate cycle. Growth in areas like insurance and wealth management are helping to achieve this goal and Lloyds’ lending is continuing to grow, helping to explain the better-than-expected performance. Returns are improving at pace and there is a sizeable increase in the dividend to cheer investors.

“That these numbers were greeted with a desultory waving of a small plastic flag rather than the presentation of an ornate garland by the market reflects the exceptional showing for the shares in recent times.

“Having delivered on the things it can control, Lloyds may now be hoping for some help from an improvement in the UK economic outlook. Nunn is also due to set out the next stage of the strategy at some point this year and this will be closely monitored by investors.”

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