Amid Brexit Uncertainty

The U.K.’s Lloyds Banking Group (LYG) said on Thursday it would cut another 3,000 jobs by the end of next year and close 200 branches amid expectations of a Brexit-induced slowdown.

Britain’s leading mortgage lender made the announcement as it announced a more-than-doubling of net profit to £1.86 billion ($2.6 billion) in the first half as so-called conduct provisions, reflecting Lloyds’ bill for compensation due to customers for “mis-sold”payment protection insurance and other misdemeanors, plunged. On an underlying basis profit slipped 5% to £4.16 billion. Jefferies noted that profit came in about 4% above consensus expectations.

STOCKS TO BUY: TheStreet Quant Ratings has identified a handful of stocks with serious upside potential in the next 12-months. Learn more.

“Following the EU referendum the outlook for the U.K. economy is uncertain and, while the precise impact is dependent upon a number of factors, including EU negotiations and political and economic events, a deceleration of growth seems likely,” said CEO Antonio Horta Osorio in a statement.

The company kept most of its forecasts intact but said capital generation “may be somewhat lower” in the future than previously anticipated because of economic uncertainty.

Lloyds also said it would lift its run-rate cost-savings target to £1.4 billion from £1 billion by the end of next year and slash its non-branch property portfolio by 30% by the end of 2018.

“We believe an incremental £200m cost reduction target was already embedded in investor expectations, so this is incrementally positive,” noted Jefferies analyst Joseph Dickerson.

At the end of the first half, Lloyds said it had a core Tier One equity ratio of 13%.

The bank is still part-owned by the state after a credit-crisis-era bailout when the government brokered the purchase of the failing HBOS by Lloyds.