Leading franchise in U.K. retail banking and strong positions in U.K. commercial and corporate banking, and insurance. Solid capitalization. Sustained improvement in funding and liquidity profiles. Still rebuilding statutory profitability. Continued earnings drag from conduct charges and restructuring. The stable outlook reflects our view that Lloyds will continue to gradually build its buffer of additional loss-absorbing capacity (ALAC) in the coming two years. The outlook also takes into account our view that over the next two years Lloyds' statutory earnings will improve substantially, it will maintain a Standard&Poor's risk-adjusted capital (RAC) ratio of about 8.5%-9.0%, and asset growth will be moderate with no significant step-up in risk appetite. We consider it unlikely that we would raise the ratings
