Lloyds Banking Group posted a £4.8bn rise in mortgage lending in the first three months of the year compared to the previous quarter, driven by “significant demand ahead of the stamp duty change”.
The business, which also owns Halifax, BM Solutions and Bank of Scotland, adds that “growth in average interest-earning banking assets was primarily driven by UK mortgages,” in a first-quarter trading statement.
The group’s total lending in the quarter to the end of March came in at £7bn, up 2% on the previous three months.
Overall, the group reported a 7% fall in pre-tax profit at £1.52bn from a year ago, as it set aside more money for bad debts amid economic uncertainty due to the global trade tariff war sparked by US President Donald Trump.
It set aside £309m for impairment charges, up from £57m a year ago, including £100m for potential borrower defaults.
The lender, led by group chief executive Charlie Nunn, said: “Initial non-UK tariffs announced in the first few days of April and the immediate market response were larger than expected.”
Lenders saw a jump in mortgage applications in the first quarter of the year ahead of a 1 April deadline, which saw the stamp duty rate threshold revert to September 2022 levels, before former Prime Minister Liz Truss’ Budget.
The levy’s threshold fell to £125,000 from £250,000 for home movers, and to £300,000 from £425,000 for first-time buyers.
