The group posted a pre-tax profit of £4.4bn, down 26% from the near £6bn reported in 2018.

António Horta-Osório, group chief executive, said its performance was impacted by a “substantial PPI charge related to the deadline for claims submission”.

The annual accounts revealed it made a provision of £2.4bn in 2019, up from £750m in 2018. It also disclosed it received five million PPI information requests in the run up to the August 2019 deadline, adding that the conversion rate remains low (around 10%).

In total, the group’s PPI bill (excluding MBNA), stands at a staggering £21.8bn.

Dividends

As a result of the groups performance, the board has recommended an increased total ordinary dividend of 3.37p per share.

This represents an increase of 5% on 2018 and is in line with Lloyds’ “progressive and sustainable” ordinary dividend policy.

Joe Healey, investment research analyst at The Share Centre, said the results highlight the difficulty being faced by the major lenders with falling profit margins and low interest rates.

“However, given the market difficulty Lloyds’ performance remained relatively resilient with the group’s restructuring and cost-cutting measures helping to support the bottom-line.

“With PPI charges now behind them, cost-cutting measures taking effect and investments in technology helping to add flexibility and scale, the company can now push forward into 2020 on the back of an improving domestic outlook post-election. Judging from this, Lloyds appears to be one of the brighter banks in the sector.”