Lloyds Banking Group has committed over £3 billion to strategic initiatives for its three year plan, for which has highlighted four priorities.
The bank revealed that it will focus on further digitising the group, transforming ways of working, increasing its capabilities and enhancing the customer experience.
Within these four priorities, the bank will look to increase its financial planning and retirement open book assets by more than £50 billion by 2020. It also aims to simplify its data and IT infrastructure and increase staff training by 50% to 4.4 million hours per year.
The bank said: ‘The strategy outlined today will enable the group to deliver strong statutory profit growth supported by targeted asset growth in key segments, a resilient net interest margin, lower operating costs, strong asset quality and lower remediation costs, whilst delivering strong capital generation and sustainable and superior shareholder returns.’
Lloyds expects operating costs to be less than £8 billion in 2020 and from 2019 onwards, it will look to deliver an income ratio in the low 40% range, down from 46.8% currently.
The announcement was accompanied by full-year results for the bank which showed statutory profit before tax of £5.3 billion, up 24% year-on-year.
The board has recommended a final ordinary dividend of 2.05p per share, taking the total to 3.05p, an increase of 20% compared to 2016. It also confirmed that it will implement a share buyback programme of up to £1 billion.
The buyback will start in March and is expected to be completed in the next 12 months.
Elsewhere, wealth customer assets increased by 7% over the year to £25 billion. However, the insurance and wealth division overall suffered from lower wealth income, taking underlying profit down by 3% to £939 million.
CEO António Horta-Osório (pictured) said: ‘2017 has been a landmark year in which the group has made significant strategic progress and returned to full private ownership. This is due to the hard work of all our people and I thank them for it.
'We have delivered another year of strong financial performance with improved profit and returns on both a statutory and underlying basis and have now built the largest and top rated digital bank in the UK. We are therefore well prepared to succeed in a digital world.’
He added: 'The external environment is evolving rapidly and I am confident that this exciting and ambitious plan, with the significant additional investment, will mean we remain at the forefront of UK financial services, and continue to deliver our mission of helping Britain prosper.'
Lloyds shares were up 1.91%, or 1.3p, at 69.15p at 9:28am.