Lloyds focused on downsizing the group's risk profile further in the first quarter of 2011. It has reduced the non-core assets portfolio by $34 billion to $285 billion during the quarter. Driven by deposit growth, the aggregate of core customer loans and advances and deposits increased from £842.0 billion at the year-end to £847.8 billion as on March 31, 2011
The group's impairment charge stood at $4.25 billion, predominately due to Ireland's impairment charge of $1.9 billion, which was higher than initially estimated. In the first quarter of 2010, impairment charge was $3.95 billion and $6.1 billion in Dec. 2010. The Tier-1 capital ratio at the end of the March quarter was 11.6% and capital adequacy ratio was 15.2%.Higher funding costs piled pressure; net interest margin came in at 2.07% compared to 2.08% in 2010 and 2.12% during Dec. 2010. On average, analysts expect the stock to gain 84% over the next one year.