U.K. bank Lloyds returned to profit in the first half of the year and indicated that it wouldn't be following in the footsteps of rival Barclays by issuing equity to meet capital requirements set by regulators.
It also indicated that it would be willing to restart paying dividends to investors. The shares jumped to close around 8 percent higher on Thursday.
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The bank reported pre-tax profit of £2.1 billion ($3.2 billion) and said it expected to reach its targets to strengthen its balance sheet faster than it had planned.
It said its core tier 1 ratio was now at 9.6 percent and it expected it to reach 10 percent by year-end, 12 months ahead of plan.
"We are now well on track to create a bank with a leading cost position, lower risk, a lower cost of equity, and products and services focused on our customers' needs, to deliver strong, stable and sustainable returns to our shareholders," Antonio Horta-Osorio, the group chief executive said in a press release on Thursday.
"As a consequence of the significant progress made in strengthening the balance sheet we now expect to commence discussions with our regulators in the second half of this year on the timetable and conditions for dividend payments."