Lloyds Banking Group specializes on financial and banking services


1. Core businesses:

Lloyds TSB was formed in 1995 and now it was known as the name of Lloyds Banking Group(LBG) which was formed in 2009 after acquisition of HBOS by Lloyds TSB. Lloyds Banking Group specializes on financial and banking services in UK, Europe and Globe, headquarter is in London, they are leading the largest financial and banking market share in UK, its activities organized into four main businesses: Retail banking, wholesale banking, insurance, wealth and international. Lloyds Banking Group owns many famous brands including Lloyds TSB, Halifax, Bank of Scotland, Scottish Widows, Clerical Medical and Cheltenham & Gloucester (Lloyds Banking Group, 2010).

Total income in 2010 is £23,986 millions, profit before tax of Group is £2,212 millions, it is very fast of growth in comparison with the year of 2009 with £6,300 millions loss, below are division's performances:

Table 1.1 Revenues and profit division in 2009 and 2010

Revenues/ Profit (loss) before Tax


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Wealth and Intenational


Operation Group


£ 9,774/1,382

£ 8,909/(4,703)

£ 2,345/(2,356)

£ 2,657/975

£ 916/(1,598)


£ 10,985/ 4,716

£ 8,562/ 3,257

£ 2,336/(4,824)

£ 2,551/1,102

£ (448)/(2,039)

(2010_LBG_Results-new release, 2011), (annual report and accounts, 2009)

Table1.2: Divisional underlying income performances

From the table 1.2, it obviously shows strong performances of Retail division, increasing 11 percent in 2010 compared with 2009, Retail contributes 46 percent in Group revenues and become the key driver in business growth of Lloyds Banking Group.

In the year of 2008, revenue of retail increase 7 percent, and profit increase 4 percent compared with 2007 (annual report,2008), revenue of retail 2009 reduce 13 percent and profit reduce 46 percent (annual report,2009), due to deep economic downturn, Lloyds Banking Group's market become more bigger and dominate the leading position of retail bank market in UK after a merger with HBOS, moreover, annual-report(2010) shows a very impressive result of increasing profit 240 percent compared with 2009, obviously, retail still keeps biggest contributions to Group's revenues and profits, and total revenues of Group will continue to be driven by very good performances of Retail in next several years as it generates the most profit to group in several last year.

As strategic vision of retail: "Retail's goal is to be recognized by customers as the UK's best bank, Retail believes this strategy will drive sustainable long term values for all stakeholders" (Annual-report, 2010)

From table 1.3, it could be said that major products of retail division are savings and mortgages which are also the strategic products of Lloyds Banking Group, that are mortgages and savings.

Table 1.3: Analyzing of retail total income by products (annual report, 2010)

Lloyds Banking Group had being faced with bankruptcy during the time of global economic, but the annual- report (2010) shows that big profit gained of £2,212 millions, it is clear that Lloyds Banking Group's growth were recovered after two years in crisis, it is really the big growth compared with loss in 2008 and 2009 up to £6,713 and £6,300 millions. The big achievement in 2009 of Lloyds Bank Group is successful in acquisition HBOS and become the biggest retail bank in UK and leading the dominated position in financial and banking services in UK, (Lloyds banking group, 2009),

The Telegraph(2009) noted that LBG became the first bank in repaying back bailout support money for government by successful right issues in 2009.

2. Corporate Social Responsibility:

Corporate Social Responsibility (CSR): "is the managerial obligation to take action that protects and improves both the welfare of society as a whole and the interests of the organizations'' (Samuel and S.Trevis,2009, p.79). CSR had being become very important and integral part in a company. CSR can create reputation and competitive advantages without PR or marketing.

Follow that trend, Lloyds Banking Group integrated CSR into its business developing strategic which drivers their success. LBG recognized that by acting best interests for all stakeholders, they can make a sustained, positive contribution to the economy and to society.

They adopted using of the European Foundation of Quality Management's CR framework. And Lloyds TSB has been integrally involved in development of the EFQM CR Framework in 2003 as a trend of the age. They integrated CSR issues in strategic planning and objectives: Enhance brand perception, increased employee engagement, customer satisfaction, develop of customer market, managing corporate responsibility (corporate social responsibility report, 2005).

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"CSR is an evolution in the approach towards sustainable development" (International Institute Sustainable Development, n.d.)

Brundtland Report (1987, quoted in Norway, 2005) suggested the term of Sustainable Development was used as: "Sustainable development satisfies the needs of the present generation without compromising the chance for future generations to satisfy theirs" and become widely popular later and form a new trend in business world requiring organization need to follow. This puts pressures on company that not only simply obeys law or make profit but also difficultly in facing with economic, environmental, social and political sustainability.

Lloyds Banking Group's climate change strategy is centered on:

-Driving down the use of resources,

-Engaging the colleagues in their environmental agenda,

-Engaging customers on climate change,

-Grasping commercial opportunities and managing the risks.

They are focus on carbon emission commitment energy efficient scheme,

They also have some other energy saving projects, reducing the carbon footprint for reduce carbon emission, increasing water pipes insulation in up to 1,000 of our branches this year,

In 2009, 54% of their waste was recycled across the Group, in 2009 they introduced a new 'single bin' recycling system for all recyclable material - plastic, cans, paper and cardboard (Lloyds Banking Group-corporate responsibility, 2009)

Samuel and S.Trevis (2009) suggested that a company should consider their stakeholder: Stockholders, suppliers, lenders, government, employees, consumers, competitors, local communities and society at large. Lloyds Banking Group always take responsible of their activities toward benefit of all their stakeholders, especially, their external stakeholder like: Customers, community, government, society.

- Customer:

They always keep communicative and received feedback from customers through face to face or complaint handling systems, try to understand what customer needs to continues improvement on products or service as well as maintain the deep and enduring relationship with customers.


They did many charitable activities though their Foundations to UK communities like: Raising charitable fund and use it for Heart Nurses in communities cross UK, sponsor for London 2012 Olympics in supporting for sport talent….

- Government:

They have a crucial role to play in shaping financial regulation and responding to the latest consumer and regulatory issues. They work closely with Government bodies to develop programs to tackle consumer issues.

- Society:

Their media and press relations program is our main tool for communicating with society in general. Offer a 24 hour press office service to engage with journalists or stakeholders need to engage with them on important issues

They yearly issue Corporate Responsibility Report. They also find feedback from stakeholders, to ensure that they are reporting on issues that are important to them.

(Lloyds banking group-corporate social responsibility, 2009)

3. Crisis management:

World economic went down in 2007, the global economic crisis began in US and spread rapidly all over the world, LBG was an unexceptional case, the house's price went down, stock-market collapse, LBG were facing with bankruptcy. In the year of 2009, UK Government would like to protect national financial system against collapse, so Lloyds is one of the banks receiving bailout injection of £37 billions from UK Government, as a result, Government have taken up to 43.4 percent in Lloyds, as a result, Lloyds became a government controlled bank.

After the right issues in the end 2009, Lloyds Banking Group repaid bailout money to UK government after raising £4billions from shareholders, loss after tax in 2008 is £6,713 millions and lost in 2009 is £6,300 millions, they took a largest ever capital raising in Europe including a £9 billions and £ 13.5billions right issue, in March 2009, they participated to Government Asset Protect Scheme which provided opportunity to reduce risk and strengthen Group's capital position. The board intends to resume dividend payments on ordinary shares as soon as market conditions and the financial performance of the Group permit, subject to the expiry, in 2012, of the restrictions arising from the European Commission's remedies (annual report and accounts, 2009).

4. Strategy:

Their corporate strategy supports company vision and is focused upon: Building strong customer franchises that are based on deep customer relationships; building a high performance organization; managing their most valuable resource, their people (Lloyds banking group-annual report, 2008)

LBG are focusing on remaining financial service market in UK as the core market, and focus on their customer, cost leadership, capital efficiency and a prudent risk appetite, especially some products of retail banking are the core products of Lloyds: Savings and mortgage (Lloyds banking group-annual report,2009)

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Company strength: After acquisition HBOS, Lloyds has become a largest retail bank in UK, with a lot of leading market position, having a good reputation, having many recognized brands, with huge number (over 30 millions ) of customers in UK and Europe, having wide distribution channels, branch networks over UK and Europe, whereby customers can access their accounts or services at anywhere. Further more, they have well-trained, capable employees to deal with customers, efficient and effective operation processes, having good cost control. All these above make Lloyds Banking Group became very successful (Lloyds Banking Group, n.d.)

Company innovation:

Lloyds Banking Group created a good, flexible working environment for employees, listen to their feedback, and employees also were equipped very good knowledge and skill by well-train, so there will be a favorable condition for creativity and innovation, it is obvious that Lloyds understood: "Without innovation, organizations tend to become less competitive and less desirable to customers as well as its organization member" (Samuel and S.Trevis, 2009, p.498),

Lloyds Banking Group is a company in the service industries so innovation could be on the products or organization structures which lead company being more successful in competitive economic environment. In 2008, "company introduced an internal artificial currency and stock market in ideas in a bid to foster an innovation culture at the UK bank" (Finextra, 2008), LBG achieved an award from Institute of Financial Services for innovation regarding to internet banking in 2004 (Lloyds TSB press offices, 2004)

5. Vision, mission and Goals:

Lloyds Banking Group's vision is defined as:" Our vision is to be recognized as the best financial service company in the UK by shareholders, customers and colleagues"( Lloyds Banking Group-Customer, n.d.). The vision is very clear that company want to be leader in financial service sector in UK by objective evaluating of their stakeholders. LBG focuses on bringing the benefit to its customers, shareholders and colleagues.

Their goal: "Our goal is to be the best financial services provider in the UK.  We believe this means we must build a leadership position not on the basis of scale but on the foundations of reputation and recommendation." "( Lloyds Banking Group-Customer, n.d.)

Employee motivation:

"Motivation is a process of furnishing organization members with the opportunity to satisfy their needs by performing productive behavior within the organization" and "in the reality, managers do not motive people. Rather, they create environments in which organization member motive themselves" (Samuel and S.Trevis, 2009, p.423),

Base on their commitment: "The Group provides unrivalled possibilities for our people to grow their careers. We invest in our people, offering the best coaching and training. We also provide our people with the opportunity to contribute to our leading corporate and social responsibility practices." (Lloyds Banking Group, n.d.)

Indeed, what Lloyds did is trying to build and maintain a good environment for their employees can motive themselves as below:

-Having a Whistle-blowing helpline for employees feedback the issues

-Having a union delivering good supports for employees

-Having the clear performance management

-Having a good and sustainable colleague pension program,

-Having a program named the charity working families with help colleagues achieve the balance in work and life (work-life balance)

-A comprehensive range of programs and packages

-Having a strong track record in supporting and promoting gender, race, disability, sexual orientation in equality.

-Having well-being, heath and safety program.

(Lloyds banking group-cr, 2009)

6. Would you like to work for this company and why?

It is undoubted that Lloyds Banking Group is the very big financial and banking services provider in the world. After doing some researches on company performances, I realized that it was really impressive for me about their very long historical bank in UK, together with their reputation, business strategies, goals, how to motivate staffs, innovation development and what they did for stakeholders, specially their corporate social responsibility. I am really desirable to work for this company after MBA graduation. This is good business environment for me to develop my career and put my small contribution for social and community welfare and development.