HIGHER INTEREST RATES DRIVE BUMPER LLOYDS PROFITS – The banking group revealed a pre-tax profit of £1.9bn for the three months to September

Lloyds has posted bumper profits as the UK’s biggest mortgage lender continues to benefit from higher interest rates.

The banking group revealed a pre-tax profit of £1.9bn for the three months to September, up from £576m in the same period last year.

The latest results follow concerns banks are raising borrowing rates much faster than they are savings rates, particularly for easy access accounts.

But banks including Lloyds have defended themselves against criticism.  Most banks have reported higher profits due to rising interest rates, as customers pay more to borrow cash for mortgages, loans and credit cards.

Lloyds, which also owns Halifax and Bank of Scotland, made £3.4bn in net interest income over the quarter.  But the figure was down slightly on the previous quarter as the bank paid more out to savers.

Since 2021 the Bank of England has repeatedly put up the UK’s benchmark interest rate, which informs rates set by High Street lenders such as Lloyds, in a bid to tackle soaring consumer prices.

Rates were left unchanged at its last meeting in September, at 5.25%, but remain at their highest level since 2008, leaving homeowners and first-time buyers under pressure.

The average rate on a fixed two-year mortgage deal is currently 6.24%, according to financial information service Moneyfacts.

The average easy access savings rate, the most common on the market, is 3.21%.