TSB posts £66m losses as it allocates over £87m for bad loans

TSB Bank has posted a £66 million pre-tax loss for the first half of this year as it allocates £87.5m for bad coronavirus loans.

The bank’s interim results revealed the bank had seen a statutory loss before tax of £65.5m, compared to a pre-tax profit of £21.1m in the first half of last year.

TSB said credit impairment charges increased by due to a “significant weakening in the economic outlook, including higher forecast unemployment and house price declines” stemming from the coronavirus pandemic.

The lender’s total customer lending increased 0.6% to £31.3bn in the first half of the year. However, any growth in its business lending and mortgages were offset by lower unsecured balances.

TSB provided £400m of support to over 15,00 small and medium sized UK firms during the coronavirus crisis through the UK Government’s Bounce Back Loans Scheme.

Earlier this week, Virgin Money allocated £43 million for bad COVID-19 loans, while Lloyds announced yesterday that it had set aside £2.5 billion to cover such lending.

At the same time, Santander set aside £11.4bn for COVID-19 loans as it suffered its largest loss in history (£9.8bn).

Today, NatWest Group announced that it has suffered an operating loss before tax of £770 million and had allocated an extra £2.8 billion for bad loans.

Debbie Crosbie, TSB’s chief executive, said: “We had a strong start to the year, but the external environment changed significantly when COVID-19 struck. We’ve benefited hugely from the technology platform we now have in place at TSB, enabling us to accelerate our digital offer for customers when they needed us most.

“Despite the challenging context, our balance sheet and capital position remain strong, we have improved efficiency in our operations, and our purpose to help people increase their money confidence has never been more relevant.

“I’m particularly proud of how TSB colleagues have responded, learning new skills, taking on new responsibilities, demonstrating real resilience, and above all putting customers first – showing TSB at its best.”

  • Read all of our articles relating to COVID-19 here.
Share icon
Share this article: