LONDON ( TheStreet) -- Lloyds Banking Group ( LYG) expects to be profitable in 2010.

Lloyds, the U.K.'s biggest mortgage company, said its banking net interest margin "is trending in line with recent guidance and this has supported a good level of income growth."

Lloyds said in the first 10 weeks of the year its trading performance has been strong. It added that costs remain under control and impairment provisions are trending lower than expected, the bank said in a statement.

Last month, the bank reported a pretax operating loss in 2009 of 6.3 billion pounds ($9.61 billion) as impairments rose 61% to 24 billion pounds. But the bank said impairments declined 21% in the second half of the year from the first half, and it expects to see "a similar pace of half yearly improvement throughout 2010."

-- Reported by Joseph Woelfel in New York.

Follow TheStreet.com on Twitter and become a fan on Facebook.