Lloyds Banking Group plc (LYG) 2011 Earnings Call February 24, 2012 4:30 am ET Executives Mark Fisher - Director of Group IT & Operations Kate O'Neill - Managing Director of Investor Relations Juan Colombás - Chief Risk Officer Andrew Geczy - Chief Executive Officer of Wholesale Banking & Markets Analysts Chris Manners - Morgan Stanley, Research Division Robert Law - Nomura Securities Co. Ltd., Research Division Jason Napier - Deutsche Bank AG, Research Division Rohith Chandra-Rajan - Barclays Capital, Research Division Manus Costello - Autonomous Research LLP Michael Helsby - BofA Merrill Lynch, Research Division Arturo de Frias Marques - Grupo Santander, Research Division Peter Toeman - HSBC, Research Division Michael Trippitt - Oriel Securities Ltd., Research Division Raul Sinha - JP Morgan Chase & Co, Research Division Gary Greenwood - Shore Capital Group Ltd., Research Division PresentationMark Fisher
Thank you, Tim. Good morning, everybody. I'd like to spend about 10 minutes talking to you about our progress on costs and simplification that I introduced to you when we here in June of last year. So let's start with costs. As Tim said, total costs reduced by 4% absolutely. At the operating expense level, excluding major increases in the U.K. bank levy and FSCS charges, costs reduced by 6%. This excellent result reflects the delivery of planned integration synergies, with in-year integration cost savings in 2011 rising to GBP 1,851 million compared to GBP 1,361 million in 2010. Our tighter approach to cost management, which I'll describe later, and lower operating lease depreciation also helped to offset inflationary pressures.