"One would expect Scottish Widows to play a pivotal role in this pensions land grab"
In its full year results for 2017, Lloyds reported a 12% rise in total life and pensions sales, driven by a 29% rise across workplace, planning and retirement and protection.
In 2017 the Bank announced the acquisition of Zurich’s workplace pensions and savings business.
It now hopes to increase its financial planning and retirement open book assets by more than £50 billion by 2020.
Lloyds posted an 8% rise in total underlying profit to £8,493 million, with revenues rising 6% to £18,525 million.
The Bank took an extra £600 million of PPI costs in the fourth quarter, with expected weekly complaints rising from 9,000 to 11,000 as a result of the FCA's new campaign. That takes the total PPI costs for the year to £1,650 million.
António Horta-Osório, group chief executive, commented: "2017 has been a landmark year in which the Group has made significant strategic progress and returned to full private ownership. This is due to the hard work of all our people and I thank them for it.
"We have delivered another year of strong financial performance with improved profit and returns on both a statutory and underlying basis and have now built the largest and top rated digital bank in the UK. We are therefore well prepared to succeed in a digital world.’
Laith Khalaf, senior analyst at Hargreaves Lansdown, commented: "There’s a lot to like in Lloyds’ numbers, with profits rising, costs under control, and prodigious amounts of cash being thrown off to shareholders.
"Lloyds is also looking at expanding into the financial planning and retirement market, and is targeting 1 million new pension customers by 2020. The government’s auto-enrolment programme is now largely in the rear view mirror, which means Lloyds will have to pinch these new customers off someone else, so it will have to sharpen up its toolkit. One would expect Scottish Widows to play a pivotal role in this pensions land grab, which lends some context to the recently announced prospective withdrawal of £109 billion of assets from Standard Life Aberdeen.
"Bad loans also remain as low levels, as you would expect given the benign economic environment and record low unemployment. Here lies the risk with Lloyds, as a shock to the domestic economy would be keenly felt by the bank. However the combination of the dividend and the new share buyback scheme means shareholders are getting a pretty tasty 6% return on their investment, which offers some compensation for the chance that Brexit may unfold in a messy manner."
