Lloyds Banking Group announces 2010 profits

Lloyds Banking Group has announced its return to profit for the first quarter of 2010.

The positive figures pushed the banks shares up by 4% in early morning trading.

In 2009, Lloyds Banking Group lost £24bn as a result of bad loans, causing the bank to make heavy losses.

The bank reported an operating loss of £6.3bn for 2009, which remain almost unchanged on the previous years loss of £6.7bn.

Lloyds, which is now 41%-owned by the taxpayer, did not reveal the extent of the profits, but did say it expected to continue making gains throughout the rest of the year.

The bank said it expected to outstrip earlier predictions and make more money than previously forecasted due to an improvement in the rate of impairments - essentially the bad debts.

According to Lloyds, the conditions of the economy were "more benign", asset prices were on the rise and funding costs were lower.

It added that while customers were still happy to deposit money, the amount that it was lending out was flat, marking a remarkable turnaround.

The loans on losses were shrinking at an accelerated rate as a result of both individual and corporate borrowers finding it easier to keep up with repayments.

Difficult areas are still present, and Lloyds said it was keeping a close eye on economic conditions, especially the investments in the Irish Republic, which has a larger budget deficit than Greece and has suffered a deep recession.

Lloyds Banking Group is currently up there with the big players in terms of the products it offers, which include high rates on Lloyds savings accounts, fixed rate bonds and current accounts, as well as some attractive extended 0% balance transfer credit cards.

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