Our Strategy

Transforming the Group for success in a digital world

In February 2018, we launched our new three year strategy and are investing more than £3 billion

We identified four strategic priorities focused on the financial needs and behaviours of the customer of the future:

Our Strategy
Leading customer experience

In order to be the best bank for customers, we recognise that we must continue to adapt to changes in customer behaviour, technology-driven competition and regulation. Our propositions must be reflective of heightened customer expectations for ease of access,  personalisation and relevance, as well as the needs created by changing life patterns.

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  • Remain number 1 UK digital bank with Open Banking functionality
  • Unrivalled reach with UK's largest branch network, serving complex needs
  • Data-driven and personalised customer propositions

Progress in 2018
In 2018 we have made significant progress in enhancing our digital propositions and branch network to reflect changing customer preferences, while also increasing personalisation.

Building a market leading digital experience
In a year in which we met more of our customers’ simple needs via mobile than any other channel for the first time, we have made a number of functionality enhancements designed to put customers more in control of their finances digitally. 

We were the first large UK bank to meet the regulatory deadline for Open Banking. We have built on this success, launching our API-enabled aggregation functionality in the fourth quarter. Through this customers are now able to view their current accounts with us alongside those held outside of the Group. 

We have also launched enhanced security and anti-fraud features including location based transaction searches and the ability to freeze and unfreeze cards via mobile, with other functionality enhancements including improved statement searches, smart alerts and upcoming payment notifications.

#1 branch network, serving complex needs
Customers continue to prefer face-to-face contact for more complex needs. We therefore remain committed to maintaining the UK’s largest branch network as part of our multi-channel proposition, while tailoring it to continue meeting these complex needs effectively. Highlights include the opening of our flagship Halifax branch in London’s Oxford Street, 16 additional routes for our mobile branch fleet, which now serves over 210 locations, the roll-out of remote advice  functionality, with 270 branches now linking directly to dedicated mortgage advisers, and  enhancements that have enabled branch colleagues to spend more time meeting customers’ complex needs.

Personalising our customer proposition
Given our extensive insight, we are well positioned to meet the growing demand for personalised customer propositions. As part of our overall response to this significant opportunity, we recently launched our Lend a Hand mortgage proposition that meets the needs of borrowers without a deposit to get onto the housing ladder, while also offering market leading savings rates to family members or other supporters who are willing to provide this deposit on their behalf. In addition, the strength of our Club Lloyds proposition has enabled strong deposit growth. These and other initiatives have enabled us to increase personalisation and to achieve growth of over £4 billion in underrepresented segments.

Focus for 2019
We will build on these strong foundations by continuing to enhance our digital functionality to meet customers’ simple needs, while also ensuring that our branch network continues to meet complex needs effectively. In 2019, we have already made our Open Banking capability available to all our Lloyds, Halifax and Bank of Scotland mobile app customers, with the significant broadening of the range of products they are able to aggregate later in the year putting them more in control of their finances. In addition we will retain our focus on using our significant data insight to develop products that are more tailored to our customers' specific needs.

Digitising the Group

Our market leading cost position and customer franchise are sources of competitive advantage. However, we must not be complacent and must further digitise the Group to drive additional operational efficiencies, improve the experience of our customers and colleagues and allow us to invest more for the future. In addition, we must continue to simplify and progressively transform our IT architecture in order to use data more efficiently, enhance our multi‑channel customer engagement and create a scalable and resilient infrastructure.

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  • Deeper end-to-end transformation targeting 70 per cent of our cost base
  • Simplification and progressive modernisation of our data and IT infrastructure
  • Technology enabled productivity improvements across the business

Progress in 2018
We have made a strong start against our strategic objectives of driving additional operational  efficiencies that will make banking simpler and easier for customers. We have embraced technology developments, with increasing levels of investment underpinning the progress made in modernising our IT and data architecture and improving processes for the benefit of both customers and colleagues.

Increasing investment in technology
To position the Group for success in a digital world, we have embarked on one of the largest transformation programmes in financial services. Consistent with this, we have increased our investment in technology by 24 per cent, placing us in the top quartile amongst peers. Over two-thirds of this spend related to enhancing existing capabilities and creating new ones, in line with our chosen approach of simplifying and modernising our IT and data architecture in a progressive manner.

Adopting new technologies
In order to improve processes and deliver better outcomes for customers, we are increasingly adopting new technologies. Key highlights in the year include the introduction of robotics for simple, repetitive tasks such as performing customer rectifications, with the resultant release of approximately 780,000 colleague hours creating additional capacity to improve processes and propositions for customers. In addition, we have introduced machine learning capabilities in a number of areas, which has also led to significant improvements to back office processes and further operational efficiencies. 

In 2018, the Group also made targeted investments in both public and private cloud solutions, with around 100 applications migrated to private cloud. These investments will deliver a more efficient, scalable and flexible infrastructure going forward and act as enablers for further investment in 2019 and beyond. This leaves us well positioned to deliver further enhancements for the benefit of customers, colleagues and shareholders.

Delivering for our customers
The launch of our Open Banking aggregation capability and multiple functionality developments throughout the year were made possible by the replatforming of our mobile app during 2018. This replatforming placed our Lloyds, Halifax and Bank of Scotland banking brands on the same platform and has enabled us to react faster to change, doubling the frequency of new releases to the market. This supported the roll out of a number of new features for customers including push notifications and virtual assistants, both of which have been positively received by customers to date, with strong satisfaction and adoption rates.

Focus for 2019
We will further embrace technology while continuing to build our innovation pipeline and  collaborate with fintechs to accelerate our transformation. We will also make better use of our extensive customer data, creating a single record for each of our customers that allow us to deliver better insight driven propositions. As a result, we will make ongoing improvements to our customer offering, leveraging our mobile app to deliver new functionality to customers in a timely manner and providing greater control and insight to customers than ever before.

Maximising the Group's capabilities

To better address our customers’ banking and insurance needs as an integrated financial services provider and improve their overall experience, we will make better use of our competitive strengths and unique business model.

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  • +£50 billion growth in financial planning and retirement open book assets under administration
  • >1 million new pensions customers
  • +£6 billion of additional net lending to start-ups, SMEs and Mid Market customers

Progress in 2018
In 2018 we have continued to enhance and leverage the Group’s capabilities to meet our customers’ banking and insurance needs more effectively.

Meeting our customers’ growing financial planning and retirement needs
As the UK’s sole integrated financial services provider we are unique in being able to show and serve all of our customers’ financial needs in one place. In the year we have begun the roll out of a Single Customer View capability, with over 3 million customers now able to view in one place the insurance and pension products they hold with the Group alongside their more traditional banking products. This single home for banking and insurance needs builds on our Open Banking aggregation capability and is supported by levels of digital engagement that significantly surpass those of standalone insurers.

We have also made a number of improvements to our customer propositions, including the expansion of our workplace pensions and savings offering following the Zurich acquisition in 2017. These and other developments have enabled us to achieve net inflows of £13 billion open book assets under administration in the year.

We embrace innovation and are working with external parties to develop potential solutions that will enable customers to consolidate their pension pots from multiple providers digitally, making it quicker and easier for them to review their retirement savings in one place.

Leveraging our partnership with Schroders to accelerate our Wealth strategy
In October, we announced a strategic partnership with Schroders to create a market leading wealth proposition that will better serve customer needs and accelerate the development of our financial planning and retirement business.

We are excited by the potential that the combination of our significant customer base, multi-channel distribution and digital capabilities with Schroders’ investment and wealth management expertise and technology brings and have consequently set an ambitious target of becoming a top three UK financial planning business within five years.

Improving the experience of our Commercial Banking clients
In Commercial Banking we have increased net lending by £3 billion and have exceeded start-ups, SMEs and Mid Market clients our sustainability target through support for renewable energy projects capable of powering over 2.6 million homes. We have also delivered improvements to the client experience by simplifying our client relationship model and enhancing our online functionality, with SME clients now able to check instantly whether they will be approved for loans or overdrafts of up to £25,000 before they apply.

Focus for 2019
In 2019 we will extend the roll out of Single Customer View, with the expectation of reaching over 9 million customers by the end of the plan period, with other areas of focus including the further development and formal launch of our wealth partnership, Schroders Personal Wealth. We will also improve the digital banking experience of our Commercial Banking clients, including significantly reducing the time to cash for unsecured lending to less than two hours.

Transforming ways of working

Our colleagues are crucial to the success of our business. In order to deliver our transformation during the current strategic plan and beyond, our colleagues will require new skills and capabilities to reflect the changing needs of the business as it adapts to the evolving operating environment. At the same time, colleague expectations of their employers are changing. As a result, we are making our biggest ever investment in colleagues to ensure that we continue to attract, develop and retain these skills and capabilities, while fostering a culture that supports a way of working that is agile, trustbased and reinforces the Group’s values.


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  • 50 per cent increase in training and development to 4.4 million hours per year
  • Up to 30 per cent change efficiency improvement

Progress in 2018
We recognise that our colleagues play a critical role in our transformation and have made significant progress in providing them with the skills they will need in the future as well as an improved working environment and tools to deliver change more effectively. At the same time, we are simplifying and improving our colleague proposition, responding to changing expectations towards employers.

Investing in our people
We are making the biggest ever investment in our people. As part of this, we have ncreased training hours by over 50 per cent to 4.3 million hours, with over 1 million of these relating to developing key skills for the future. We are on course to deliver our target of cumulative 4.4 million training hours relating to skills for the future by 2020.

In addition, we have brought our teams closer together, improving productivity and bringing further benefits to our colleagues’ working experience. Over 32 per cent of colleagues are now located in modern, collaborative working environments, as we continue to move to six strategic hubs across the UK. 

We are also reducing complexity to allow our colleagues to spend more time focusing on decisions that really matter. Consistent with this focus, we have started the migration of 60 people processes and systems onto a single HR platform, leveraging cloud based technology, and completely redesigned our performance management process, one of our key colleague journeys, reducing management time, bureaucracy and process, and focusing on meaningful colleague feedback and development.

Embracing new ways of working
We are embracing new ways of working and transforming the way in which change is delivered. In particular, 15 per cent of change is now delivered using Agile, with 6,600 colleagues trained in these methodologies. This allows us to build cross functional teams and increase collaboration, efficiency and expertise in our decisions and, through this, deliver products and services that our customers really want, at a pace that ensures these remain relevant and timely. The ongoing improvement in the capabilities of our people and the methods in which we work will drive a continued cultural shift across the organisation and will help us deliver our significant strategic transformation. In addition, this will improve satisfaction and make it easier to do business, while also delivering a leading customer experience.

Focus for 2019
We will continue to roll out Agile as we move towards our target of more than 50 per cent of change delivered through these methodologies by the end of this strategic plan. This combined with changes that will bring our colleagues closer together, boosting innovation and increasing simplicity, will make it easier for our people to focus on delivering greater value for customers. We will also further up-skill our colleagues alongside targeted recruitment to ensure our olleagues have the required capabilities to deliver our transformation. The attraction, retention and development of talent will be supported by further improvements to our colleague proposition, ensuring that this remains compelling and aligns to our culture.