Lloyds

Chancellor George Osborne has hailed the announcement of £1.8bn profits at Lloyds Banking Group as a "major milestone in the recovery of the British economy", ITV News Business Editor Joel Hills has reported.

Lloyds also confirmed money has been set aside to cover the continuing fallout from the PPI scandal.

Lloyds Banking Group will pay its first dividend to shareholders in six years - since its 2008 bailout - after reporting annual profits of £1.8 billion.

The payments to the three million shareholders will total £535 million after the fourfold rise in annual profits.

Lloyds was rescued after an input of £20 billion taxpayer funds in 2008 at the height of the financial crisis.

The Government's 40% stake has since been reduced to 24%, meaning the Treasury will receive £130 million from the company's 0.75p a share dividend payment.

The Government has netted another £500 million from the sale of shares in Lloyds Banking Group, it was revealed today.

The transactions mean the UK taxpayer now holds a 23.9% stake in the bank, compared with 40% when it was bailed out during the financial crisis.

The amount of money recovered from the bank is now just under £8 billion after the latest round of share sales was launched in December.

The government is concerned banks will not honour a pledge to preserve the 'last bank in town' after Lloyds announced plans to close 150 branches and cut 9,000 jobs.

ITV News Political Correspondent Emily Morgan reports:

Business Secretary Vince Cable is set to write to big banks urging them to keep branches open in towns where there are no other banks open.

It follows an announcement from state-backed Lloyds bank that it is going to close 150 branches and make 9,000 staff redundant.

ITV News Business Editor Joel Hills is following developments.

Analysis: Lloyds job cuts: Banking group follows customers online

The Unite union has said that job losses announced by the Lloyds Banking group represent "deeply unsettling times" for staff.

Lloyds balance sheet had to take into account one off charges including a £900 million increase in provision for payment protection insurance (PPI) scandal. It takes the running total of the sum set aside for PPI by Lloyds to £11.32 billion.

The job cuts announced by Lloyds represent around 10% of its current workforce of 88,000. It has already slashed more than 30,000 since the start of the financial crisis.

The group, which is 25% owned by the taxpayer, said it plans to "digitise" the bank, adding that it wants to simplify the business and be more efficient.

Meanwhile, third-quarter results showed underlying profits for the business, which includes Halifax and Bank of Scotland, up 41% to £2.2 billion.

Bottom line pre-tax profits were £693 million after taking into account one-off charges including a £900 million increase in provision for payment protection insurance (PPI) scandal.

The Taxpayer-backed Lloyds Banking Group is to cut 9,000 jobs over three years and shut 150 branches, it announced.