Lloyds Banking Group has reported pre-tax profits of £5.3 billion for the past year, up 24%.

It has reported a total ordinary dividend of 3.05 pence per share, up 20% on 2016, and a share buyback of up to £1 billion representing an increase in total capital returns of up to 46%. Total capital return will be up to £3.2 billion.

Lloyds said its mortgage book reflected its desire for margin rather than volume. The average indexed loan to value (LTV) improved to 43.6% and the value of lending with an indexed LTV of greater than 80% fell to £30.7 billion. Impaired loans as a percentage of closing advances were 1.3%, down from 1.4%.

Its PPI charge of £1,650 million included an additional £600 million in the fourth quarter reflecting an increase in expected weekly complaints from 9,000 to 11,000, which is the average level of complaints for the last nine months. The outstanding balance sheet provision at 31 December 2017 was £2.4 billion.

António Horta-Osório, Lloyds Banking Group chief executive, said: “2017 has been a landmark year in which the Group has made significant strategic progress and returned to full private ownership. This is due to the hard work of all our people and I thank them for it.

“We have delivered another year of strong financial performance with improved profit and returns on both a statutory and underlying basis and have now built the largest and top rated digital bank in the UK. We are therefore well prepared to succeed in a digital world.”