Lloyds Banking Group

Is Lloyds Bank safe?

Yes for your deposits. Lloyds Banking Group, which owns Lloyds Bank, Halifax and Bank of Scotland, had a CET1 ratioCET1 ratioA bank's highest-quality capital (mainly shares and retained profits) as a share of its risk-weighted assets. Higher means more room to absorb losses.More in the glossary of 13.6% at 30 June 2026 against a total requirement of about 12%, and its liquidity coverage ratioLiquidity coverage ratioA bank's cash and easy-to-sell assets compared with the money that could flow out in a 30-day crisis. It must be at least 100%.More in the glossary averaged 144%. UK savings are covered by the FSCSDeposit insuranceA government-backed scheme that repays bank customers up to a set limit if their bank fails, such as the FDIC in the US or the FSCS in the UK.More in the glossary to £120,000 per person per banking licence. The record is the weaker part: a £20.3 billion state rescue in 2008, a £1.95 billion provision for car finance redress, and a March 2026 glitch that exposed customers' transactions to strangers. We score it 70/100.

Lloyds, Halifax and Bank of Scotland: one limit or two?

This is the question that matters most for anyone with large savings in the group. FSCSDeposit insuranceA government-backed scheme that repays bank customers up to a set limit if their bank fails, such as the FDIC in the US or the FSCS in the UK.More in the glossary protection works per banking licence, not per brand, and Lloyds Banking Group runs two licences for most retail customers:

Legal entity	Brands	FSCS limit
Lloyds Bank plc	Lloyds Bank	£120,000
Bank of Scotland plc	Halifax, Bank of Scotland	£120,000 shared

So £120,000 at Lloyds and £120,000 at Halifax are both fully covered, but £120,000 at Halifax and another £50,000 at Bank of Scotland are not. Lloyds accounts usually have sort codes starting 30 or 77, and Bank of Scotland plc accounts (including Halifax) start with 11. The FCA register lists every trading name under a licence. The limit rose from £85,000 on 1 December 2025.

Capital and funding

Lloyds is a simpler bank than Barclays or HSBC. Almost all of its business is UK mortgages, savings, cards, car finance and commercial lending, with no large trading arm. Its requirement of about 12% includes a 2% buffer that the ring-fenced bank must hold for its importance to the UK economy, and the board aims to run at about 13%, so the 13.1% pro forma figure after the half-year buyback leaves only a modest cushion above the target. Senior bonds of the holding company, Lloyds Banking Group plc, were rated A3 by Moody's, A- by S&P and A+ by Fitch in August 2026. Lloyds Bank plc, which holds the deposits, sits below the holding company in the group, and Fitch raised its senior ratings in May 2026.

Funding is mostly UK savings and current accounts: £500.9 billion of customer deposits at June 2026, against £107.8 billion of wholesale funding. The group held £131 billion of high-quality liquid assets on average. The one soft spot is that it lends out about 98 pence for every pound of deposits, against 75 pence at Barclays, so it has less spare deposit funding to fall back on.

Car finance and other fines

Lloyds owns Black Horse, a big UK car lender, which makes it the bank most exposed to the motor finance commission issue. After the Supreme Court's August 2025 judgment in Johnson v FirstRand found an unfair relationship in one case, the FCA set up a redress scheme and published its final rules in March 2026. Lloyds' total provision is £1.95 billion. It took no further charge in the first half of 2026 but warns the final cost could differ materially, and four legal challenges to the FCA scheme were pending.

Other conduct issues in the last decade:

• June 2020: the FCA fined Lloyds Bank, Bank of Scotland and The Mortgage Business £64 million for how they treated mortgage customers in arrears, with about £300 million of redress.
• HBOS Reading: the group is still applying the recommendations of Sir Ross Cranston's review of compensation for small businesses defrauded at HBOS's Reading branch before 2007.

Just outside the ten-year window, the FCA fined the group £117 million in 2015 for its handling of PPI complaints and £105 million in 2014 over LIBOR and Bank of England repo rate manipulation.

The March 2026 app glitch

On 12 March 2026 a software defect introduced in an overnight update let customers of Lloyds, Halifax and Bank of Scotland see other people's transactions in the app. Lloyds told MPs that up to 447,936 customers were affected and 114,182 clicked into transactions that were not theirs, which could reveal payment references and details such as National Insurance numbers. It paid early compensation for distress and reported the breach to the FCA, the PRA and the Information Commissioner's Office. No money was taken, but for a bank of this size it is a serious privacy failure, and it came a year after its apps failed during the February 2025 payday outages that also hit other banks.

2008: rescued, then repaid

Lloyds TSB agreed to buy HBOS at the height of the 2008 crisis with government support, and the combined group then needed £20.3 billion of state capital. The government owned about 43% at the peak. It sold its last shares in May 2017, and Lloyds said about £21.2 billion had gone back to the taxpayer, roughly £900 million more than was invested. NatWest, rescued at the same time, took much longer.

How to keep your money safe at Lloyds

1. Count Halifax and Bank of Scotland together. Keep no more than £120,000 per person across both, and no more than £120,000 at Lloyds Bank.
2. A joint account is covered up to £240,000. Temporary high balances, such as house sale proceeds, can be covered up to £1.4 million for six months.
3. If you had a car loan with Black Horse between 2007 and 2024, watch for contact under the FCA redress scheme; you should not need a claims firm.
4. Keep a debit card from an unconnected bank, such as Santander UK, for days when the app or card systems are down.

How we scored it

Deposit protectionDeposit insuranceA government-backed scheme that repays bank customers up to a set limit if their bank fails, such as the FDIC in the US or the FSCS in the UK.More in the glossary and liquidity (85 each) are Lloyds' strongest factors, helped by two separate FSCS licences and a large retail deposit base. The 2008 rescue holds stability history at 45, conduct (52) reflects the motor finance bill, and digital security (58) is marked down for the 2026 data exposure.