Banking giant Lloyds TSB today warned it was battling against "unprecedented" market turmoil worldwide as it managed to hold first half profits stable despite a sharp rise in bad debt provisions.
The collapse of Enron and WorldCom in the United States and the economic turbulence in Argentina saw bad debt provisions soar to £479 million sterling in the six months to June 30th, some 48 per cent above the same period last year.
Chief executive Mr Peter Ellwood said the gloomy economic climate and volatile stock markets had a direct impact on the group's operations in the first half and would continue to do so until "some stability returns".
He added, however, the group had achieved a "solid" set of results with pre-tax profits edging ahead by £1 million to £1.6 billion on total income of £4.6 billion, up 6 per cent on the first half a year ago. The bank's trading surplus - profits before bad debt provisions and the impact of stock market fluctuations - rose by 11 per cent to £2.2 billion, in line with analysts' estimates in the City.
LLoyds announced plans to cut 5,000 jobs in February after seeing annual profits slide and Mr Ellwood said the group's control on costs had helped it to withstand the market volatility.
PA