April 30 - State-backed Lloyds Banking Group reported a jump in first-quarter profit and increased its cost savings target, helping its shares close in on the government's price for breaking even. Hayley Platt asks if Europe's banks may have turned a corner.
1.48 billion pounds is today's daily digit in Europe - the pre-tax profits for Lloyds Banking Group in the first quarter. It's almost £500 million more than a year ago. The state-backed bank has been working to cut costs to shrink the business. Costs fell 6 percent in the first quarter from a year ago. So does this signal a turnaround for Europe's banks? William Hobbs from Barclays says there's still plenty of work to do. SOUNDBITE: William Hobbs, VP Research, Economics & Strategy, Barclays, saying (English): "Whether we've turned a corner in Europe in terms of economic trajectory is still very difficult to say. But underlying at Deutsche, UBS they both look alright apart from the cash call on Deutsche's part. For Lloyds it's quite difficult to call it an underlying read of what's going on in the economy, although there was some loan growth quite a lot of that is down to the size of impairments coming down quicker than analysts expected." Lloyds' progress hasn't been without setbacks. European authorities ordered it to sell 630 branches, as the price of its state bailout during the financial crisis. Earlier this month a deal to sell them to the Co-operative fell through. It's now looking for a new buyer. Lloyds' stock jumped almost 7 percent on its results, hitting a high of just over 57 pence. The UK government thinks a sale at 61 pence would allow it to break even - after it pumped £20.5 billion into the bank during the financial crisis. It's understood the government is keen to start selling off shares in the bank before the 2015 general election.