Lloyds Banking Group is to invest £3 billion over the next three years to transform the business into a "digitised, simple, low risk, customer focused, UK financial services provider".

In a strategy update presented alongside its annual results, the UK bank pledged to deploy new technology to drive additional operational efficiencies including deeper end-to-end transformation targeting over 70% of the cost base; simplification and progressive modernisation of data and IT infrastructure; and technology-enabled productivity improvements across the business.

The £3 billion price tag is 40% up on the spend allocated for the previous three-year plan, which saw thousands of jobs cut as the bank re-engineered the business to take advantage of new mobile and online channels.

The new plan is aimed at reducing operating costs to less that £8 billion in 2020 and a cost:income ratio in the low 40s.

Introducing the plan, António Horta-Osório, group chief executive says: "As we look to the future, we see the external environment evolving rapidly. Changing customer behaviours, the pace of technological evolution and changes in regulation all present opportunities. Given our strong capabilities and the significant progress made in recent years we believe we are in a unique position to compete and win in this environment by developing additional competitive advantages. We will continue to transform ourselves to succeed in this digital world and the next phase of our strategy will ensure we have the capabilities to deliver future success."