Blueprint
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C.20549
FORM 6-K
Report of Foreign Private Issuer
Pursuant to Rule 13a-16 or 15d-16
of the Securities Exchange Act of 1934
(30
November 2016)
LLOYDS BANKING GROUP
plc
(Translation of registrant's name into
English)
5th Floor
25 Gresham Street
London
EC2V 7HN
United Kingdom
(Address
of principal executive offices)
Indicate
by check mark whether the registrant files or will file annual
reports
under
cover Form 20-F or Form 40-F.
Form
20-F..X.. Form 40-F.....
Indicate
by check mark whether the registrant by furnishing the
information
contained
in this Form is also thereby furnishing the information to
the
Commission
pursuant to Rule 12g3-2(b) under the Securities Exchange Act of
1934.
Yes
...... No ..X..
If
"Yes" is marked, indicate below the file number assigned to the
registrant in connection with Rule
12g3-2(b):
82- ________
Index
to Exhibits
Item
No.
1 Regulatory News Service Announcement, dated 30 November
2016
re: PRA
Stress Test Re-affirms Strong Capital Position
30
November 2016
THE BANK OF ENGLAND STRESS TEST RE-AFFIRMS THE STRONG CAPITAL
POSITION OF LLOYDS BANKING GROUP
Lloyds
Banking Group plc (the 'Group'), together with six other financial
institutions in the UK, has
been
subject to the 2016 stress test conducted by the Bank of England
(the 'BoE').
The
test assesses banks' capital adequacy against their own minimum
Common Equity Tier 1 (CET1) capital and Tier 1 leverage thresholds.
For the Group these thresholds are 7.0 per cent for CET1 (4.5 per
cent Pillar 1 mimima plus 2.5 per cent Group specific Pillar 2a)
and 3 per cent for Tier 1 leverage.
In
addition, the test also includes a 'systemic reference point'
('SRP') assessment for globally systemic banks ('G-SIBs'). As the
Group is not a G-SIB, this hurdle rate does not apply.
This
year's stress test has been designed under the BoE's new annual
cyclical framework, with the severity of the stress reflecting the
BoE's Financial Policy Committee (the 'FPC') and the Prudential
Regulation Authority (the 'PRA') Board's assessment of imbalances
across financial markets and the global and UK economies. This
resulted in a more severe stress for the UK economy than in the
2015 scenario. The key economic assumptions impacting the Group's
operations included UK unemployment peaking at 9.5 per cent, and UK
house and commercial property prices falling 31 per cent and 42 per
cent, respectively.
Result of the stress test
Despite
the more severe stress on the UK economy, the Group comfortably
exceeds the higher capital and leverage thresholds set out for the
purpose of the stress test; therefore, it is not required to take
any capital action as a result of this stress test.
In the
trough of the stress, the BoE calculated the Group's estimated CET1
ratio as 9.7 per cent and its leverage ratio as 4.1 per cent
pre-management actions, and 10.3 per cent and 4.3 per cent
post-management actions, respectively, compared with a reported
CET1 ratio of 12.8 per cent and leverage ratio of 4.8 per cent as
at 31 December 2015.
The
CET1 ratio low point under stress has improved since the 2015
exercise despite the more severe UK stress, reflecting the
successful de-risking undertaken by the Group.
This
re-affirms the strong capital and balance sheet position of the
Group.
Further details
Details
of the PRA approach to the stress test and the detailed results in
relation to all participating banks are available from the Bank of
England's website.
- END
-
For
further information:
Investor Relations
Douglas
Radcliffe
+44 (0)20 7356 1571
Group
Investor Relations
Director
douglas.radcliffe@finance.lloydsbanking.com
Edward
Sands
+44 (0)20 7356 1585
Director
of Investor
Relations
edward.sands@lloydsbanking.com
Corporate Affairs
Matt
Smith
+44 (0) 20 7356 3522
Head of
Corporate
Media
matt.smith@lloydsbanking.com
Shella
Ali
+44 (0) 20 7356 2017
Corporate
Media Relations
Manager
shella.ali@lloydsbanking.com
FORWARD
LOOKING STATEMENTS
This
document contains certain forward looking statements with respect
to the business, strategy and plans of Lloyds Banking Group and its
current goals and expectations relating to its future financial
condition and performance. Statements that are not historical
facts, including statements about Lloyds Banking Group's or its
directors' and/or management's beliefs and expectations, are
forward looking statements. By their nature, forward looking
statements involve risk and uncertainty because they relate to
events and depend upon circumstances that will or may occur in the
future. Factors that could cause actual business, strategy, plans
and/or results (including but not limited to the payment of
dividends) to differ materially from the plans, objectives,
expectations, estimates and intentions expressed in such forward
looking statements made by the Group or on its behalf include, but
are not limited to: general economic and business conditions in the
UK and internationally; market related trends and developments;
fluctuations in interest rates (including low or negative rates),
exchange rates, stock markets and currencies; the ability to access
sufficient sources of capital, liquidity and funding when required;
changes to the Group's credit ratings; the ability to derive cost
savings; changing customer behaviour including consumer spending,
saving and borrowing habits; changes to borrower or counterparty
credit quality; instability in the global financial markets,
including Eurozone instability, the exit by the UK from the
European Union (EU) and the potential for one or more other
countries to exit the EU or the Eurozone and the impact of any
sovereign credit rating downgrade or other sovereign financial
issues; technological changes and risks to cyber security; natural,
pandemic and other disasters, adverse weather and similar
contingencies outside the Group's control; inadequate or failed
internal or external processes or systems; acts of war, other acts
of hostility, terrorist acts and responses to those acts,
geopolitical, pandemic or other such events; changes in laws,
regulations, accounting standards or taxation, including as a
result of the exit by the UK from the EU, a further possible
referendum on Scottish independence; changes to regulatory capital
or liquidity requirements and similar contingencies outside the
Group's control; the policies, decisions and actions of
governmental or regulatory authorities or courts in the UK, the EU,
the US or elsewhere including the implementation and interpretation
of key legislation and regulation; the ability to attract and
retain senior management and other employees; requirements or
limitations on the Group as a result of HM Treasury's
investment in the Group; actions or omissions by the Group's
directors, management or employees including industrial action;
changes to the Group's post-retirement defined benefit scheme
obligations; the provision of banking operations services to
TSB Banking Group plc; the extent of any future impairment
charges or write-downs caused by, but not limited to, depressed
asset valuations, market disruptions and illiquid markets; the
value and effectiveness of any credit protection purchased by the
Group; the inability to hedge certain risks economically; the
adequacy of loss reserves; the actions of competitors, including
non-bank financial services, lending companies and digital
innovators and disruptive technologies; and exposure to regulatory
or competition scrutiny, legal, regulatory or competition
proceedings, investigations or complaints. Please refer to the
latest Annual Report on Form 20-F filed with the US Securities and
Exchange Commission for a discussion of certain factors together
with examples of forward looking statements. Except as required by
any applicable law or regulation, the forward looking statements
contained in this document are made as of today's date, and Lloyds
Banking Group expressly disclaims any obligation or undertaking to
release publicly any updates or revisions to any forward looking
statements. The information, statements and opinions contained in
this document do not constitute a public offer under any applicable
law or an offer to sell any securities or financial instruments or
any advice or recommendation with respect to such securities or
financial instruments.
Signatures
Pursuant to the
requirements of the Securities Exchange Act of 1934, the registrant
has duly caused this report to be signed on its behalf by the
undersigned, thereunto duly authorized.
LLOYDS
BANKING GROUP plc
(Registrant)
By: Douglas
Radcliffe
Name: Douglas
Radcliffe
Title: Group
Investor Relations Director
Date:
30 November 2016