Lloyds Q3 results are ahead of market forecasts despite a 7% year-on-year drop in profits before tax to £1.82bn.

For the year to date, Lloyds’ reports statutory profit after tax of £3.7bn up 18% with underlying profit up 5% at £6.3bn.

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Lloyds reaffirms its fiscal 2018 full year forecasts with two key metrics notable highlights of the quarter. Improving margins boost Lloyds’ net interest margin by 8 basis points to 2.93% from 2.85% a year ago.

Meantime costs fell by 3% from the year ago period while the cost: income ratio further improved to 47.5%.

António Horta-Osório, Group CEO says in a statement: “These results further demonstrate the strength of our business model and the benefits of our low risk, customer focused approach. We have also made a strong start to our 2018 to 2020 strategic plan.

“We have been implementing the initiatives which we announced in February as part of our ambitious strategy to transform the Group for success in a digital world. Our strategic investment has accelerated and is already delivering real benefits to customers whilst operating costs continue to reduce.”

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Other Lloyds Q3 highlights include:

  • Strategic investment of £0.6bn with focus on enhancing processes and customer experience, as part of its £3bn strategic investment 2018-2020 plan;
  • reducing account opening times by almost 40%;
  • strategic wealth management partnership with Schroders;
  • Completing the sale of a c.£4bn Irish mortgage portfolio;
  • Retail and Commercial combined current account balances up 7% for the year to date;
  • Investment in robotics driving significant process improvement and enhanced productivity with c.600k colleague hours saved year to date.

Lloyds will launch an API-led Open Banking proposition in November.

Horta-Osório adds: “We remain on track to deliver the improved financial targets for 2018 that we announced in August.”